The Butterfly Effect: A British AAR

The election was scheduled for Friday December 27th, although almost every campaign was planned to peak on the 23rd. Some have argued that the absence of campaigning on the 24th to the 26th was a sign of the respect all parties showed to Christmas period, others contend that it was a fear of annoying the electorate and losing their votes that was the real reason.

Regardless of the reasons this left Churchill only ten days to turn around the fortunes of the Conservative party. Showing the demand for activity that would come to be the hallmark of his premiership he threw himself, and a selected core of long standing anti-appeasement and pro-rearmament Conservative MPs, into a nationwide tour.


While the large rallies and regular newspaper interviews, most notably in the Daily Express, were able to partly restore the party's position much of the country still remained to be convinced. There was also a significant minority who still opposed any form of rearmament and even groups who believed in 'peace at any price'. The supporters of this policy, generally the most naive and extreme appeasers, were limited in number, but not impact. Eventually one group so disrupted a speech Churchill was making he answered their catcalls and made his 'Enemies' speech. Clearly impromptu and unplanned it was a defining moment in the campaign.

"You say my actions will make enemies. Do you have any enemies?"

[The heckler in the crowd says he does not and doesn't want any.]

"Then you have never stood up for anything in you life. If this great nation stands up for what is right for will it make enemies? Most assuredly yes, indeed if the words, and actions, of this Island are to make any impact they must!

Should we sacrifice all that this nation has built, all that we as a race believe in and have fought for just to avoid making enemies? Never! Throughout the glorious past of this country we have never sought enemies, but we have never feared making them when standing up for what is right.

Will this be the generation that shirks it's responsibilities and heritage or will this generation of Britons prove itself not unworthy of the days of yore and not unworthy of those great men, the fathers of our land, who stood up for what was right and honourable and shaped the greatness of our country."


As election day approached opinions polled indicated that the Liberals were falling further behind and that the Labour party was severely damaged by Lansbury's continuing leadership. That left the election as a straight fight between the Conservatives and the National Liberals. With the two parties increasingly difficult to distinguish between it was considered that the return to power of the National Government was assured, an outcome almost unthinkable at the start of the campaign.

Nevertheless the unthinkable happened and the National Government was returned to power with the Conservatives winning 438 seats, down 35, and the National Liberals 67, up 22 seats on 1931. This meant an overall reduction in the government's majority, but in the circumstances both parties still celebrated. The National Liberals were now the dominant liberal party while the Conservatives had snatched victory from the jaws of electoral death.

As the celebrations went on into the night the wheeling and dealing about cabinet roles started. Few expected the old guard from either party to survive long in the new government set up and ministerial horse trading was the only topic of conversation.

Up next: The new government and the new year.

In Westminster the new year started as the old one had ended, with the National Government negotiating over the composition of the cabinet. While no one doubted that Winston Churchill would be Prime Minister or that Sir John Simon would retain the Home Office almost every other position was fiercely contested. The bargaining position of the Conservatives was weak despite their party's numerical superiority. Their front line leaders were still publicly discredited and while they had many other MPs few of them had the experience or ability to run a ministry.

The breakthrough in negotiations came when it was agreed that a National Liberal, Leslie Hore-Belisha, would serve as Chancellor of the Exchequer. The initial reaction from many was dismay, while Hore-Belisha had served as Secretary to the Treasury and had done solid work as Minister for Transport few believed he was ready for such a senior appointment. The Conservatives were worried by the National Liberals holding both the Home Office and Treasury, while many Liberal MPs couldn't understand why Sir John hadn't taken the more prestigious Treasury position.


The concern of both parties was misplaced, as Churchill commented to an ally "Don't worry about Belisha, he's not getting the job he thinks he is." It soon became apparent that many of the Treasury's powers were being transferred to other departments, greatly weakening the post of Chancellor. While many departments gained new powers and freedoms from the Treasury the two biggest winners were the the two new ministries, Defence Co-ordination and Production and Development.

To head up the Ministry of Production and Development Churchill selected Lord Beaverbrook, an appointment he had to fight his National Liberal allies to push through. As the ministry would be charged with getting the country out of the depression by whatever means necessary and using any powers of state required, it was a very important post and many were worried Beaverbrook was not the right man for the job. It is said that Churchill had to set Beaverbrook a limit of only one hundred days to make an impact or be replaced, a tight deadline indeed.

The other new position, the Minister for Coordination of Defence, was given responsibility for the re-armament of British forces. To achieve this the minister was given power over the budgets of the three services, power taken from the Treasury. The new minister, Leopold Stennett Amery, had been a fierce critic of appeasement and had served as First Lord of the Admiralty. Although he was under considerably less pressure than Beaverbrook, much was expected of his time in office.


The new man at the Foreign Office provided yet another surprise from Churchill with the appointment of Austen Chamberlain as Foreign Secretary. While Chamberlain had been Foreign Secretary in the past, indeed he won the Nobel Peace Prize for his work on the Locarno Pact, he had also described Mussolini as "a man with whom business could be done". In his favour he had been calling for re-armament for many years and had many years of parliamentary and cabinet experience. In the end it was his experience and status as Nobel peace laureate that were most valuable, if even a proven man of peace believed the country should re-arm how could one argue?


While the War Office and Air Ministry re-organisations were delayed until a thorough re-armament plan was prepared the Admiralty received the personal and urgent attention of Churchill. Despite speculation he might appoint himself as First Sea Lord he instead turned to one of the British Empire's greatest naval heroes; Sir Roger Keyes.

Keyes career stretched from anti-slavery patrols in the 1880s, through his heroic actions during the Boxer Rebellion and the triumphant Zeebruge raid to his final operational posting as Commander in Chief Portsmouth, the most important Royal Navy home command. As a strong proponent of a strong navy and a return of the Fleet Air Arm to navy control he had made many enemies, as a result he had been passed over for First Sea Lord by the Labour Government in 1930 and had retired from active service in 1931. Although sixty three at the time of his appointment he would prove to be the most influential and dynamic First Sea Lord since Lord Fisher.


With the main outline of his cabinet complete Churchill threw himself into the Abyssinian problem, prompting howls of protest from senior civil servants and mandarins who demanded he finish the cabinet reshuffle. Churchill's blunt reply "If we delay a week appointing a Minister for Transport, no-one will notice. If we delay even for a day intervening in Abyssinia it may be too late." brooked no opposition.


Up next: The rest of the cabinet and Mussolini's reply.


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Butterfly Redux Notes:
I am decidedly unsure about including that game screenshot. I am still half-minded to remove it as not quite fitting the flow, yet it stays for now as it does a job and I've probably spent too long on this Redux Project as it is.

Leslie Hore-Belisha's appointment as Chancellor of the Exchequer was surprising at the time and has, over the years that followed, attracted a great deal of comment and more than it's fair share of conspiracy theories. Broadly speaking there are three lines of discussion around circumstances of his appointment, and the subsequent weakening of the Treasury's power, the constitutionalist argument, the 'conning' of the National Liberals and those who focus on Hore-Belisha's faith as the critical factor.

The constitutionalists argue that as the Treasury is traditionally the most powerful department in Whitehall, weakening the Chancellor strengthens the Prime Minister and so pushes the country towards a more Presidential, rather than Cabinet, style of government. At first sight there is something in this argument, certainly Churchill's undoubtedly powerful personality and seemingly boundless energy he attracted a great deal more media attention than his predecessors as Prime Minister, coverage that to some extent came at the extent of his Cabinet colleagues. However visibility is not the same as importance, just because a Cabinet minister does inspire media interest does not mean they are doing unimportant work. More relevantly this over-estimates Churchill's abilities, his attentions were strong, deep but narrow, areas outside of his current concerns were generally left to the relevant Minister with little to no oversight. Declassified minutes show that getting Churchill to show an interest in a subject was a much more common problem that complaints of excess Prime Ministerial control. In any case the majority of the Treasury's powers did not go to the Prime Minister, but to other departments which owed their temporary existence to the economic conditions of the country. Certainly it may not have been constitutionally ideal, but then very few of Britain's constitutional affairs were and yet things managed to work without the government, or the country, falling into the many traps the constitutional purists insisted were waiting.

Taking the last point, Hore-Belisha was a Jew and so was sadly fated to have a minority view his every action from that perspective. At the one extreme once could find Oswald Mosely declaring that his appointment was an example of the all-powerful 'Jewish lobby' getting one of their own into high office, at the other those claimed the Treasury was only weakened because Hore-Belisha was appointed Chancellor and that he was therefore a victim of anti-Semitism. In fact the truth of the appointment was far less dramatic than either extreme and had nothing at all to do with faith. Regardless of candidate Churchill had always intended for the Chancellor's position to be watered down, partly as he intended to offer it to the National Liberals as concession but mainly as he wanted economic policy taken out of the hands of Treasury mandarins. Churchill did not trust the bureaucrats of Whitehall to push through the polices needed to re-vitalise the economy and wanted to minimise their influence on economic policy. The men he would appoint would be from outside the traditional Westminster orthodox, with all the benefits and problems that came with that, and the powers they would need would have to come from the Treasury.

This brings up the final complaint, that the National Liberals were swindled out of their fair stake in government. There is clearly no depth to this accusation, if the National Liberal leadership had truly believed they were getting the Treasury Sir John Simon would have insisted on being Chancellor and he didn't. The National Liberals were well aware that the Conservative party would never tolerate them holding too many powerful departments at once, not without some compromises, so were well aware of quite what Hore-Belisha was being signed up for. It should also be noted that many of the Treasury's powers on tariffs and trade, issues on which Liberals famously held strong views, were transferred to the Board of Trade, which remained headed up by the National Liberal Walter Runciman


The somewhat unexciting truth is that Hore-Belisha was made Chancellor because he had shown he was a solid administration in his time as Treasury Secretary and Minister for Transport, but he wasn't outstanding or massively popular. He had shown the energy and drive to get schemes developed and successfully implemented, but he did not have radical plans to completely reinvent the Treasury and he had solid pro re-armament credentials so would go along with the planned increases in defence expenditure. Crucially he lacked a base of support in the party, an unfortunate side effect of the ease and regularity with which he made enemies, so was unlikely to turn the Treasury into a power base with which to threaten Simon for the leadership. In short the perfect man to implement some needed but steady reform to the Treasury, while others carried out the more radical work elsewhere.

Moving onto one of these areas of reform, the responsibility for economic planning was placed with Lord Beaverbrook's Ministry of Production and Development. Beaverbrook had made his reputation, and his fortune, by hiring the best in the business and letting them get on with it while he worked on the next big deal or grand plan. As he intended to move in the highest circles of government his approach to the economy was no different, he wanted to set the grand plan, appoint excellent people to carry it out and then return to High Politics and grand strategy. To this end his first appointment was Sir Walter Jones.


Sir Walter had first made his name as Chairman and Managing Director of the United Steel Companies, one of the first vertically integrated steel companies that included the coal mines, coking plants and the iron and steel mills. After successfully guiding the company through the ravages of the Depression, a significant enough achievement given the collapse of iron and steel demand, his big coup was to notice the potential combination of the Jarrow yards and his steel works. Steel making is most efficient when a certain amount of scrap is added during the process, and the higher the grade of scrap the better. The best grades of steel were from large ships, ships which the Jarrow yards were equipped to scrap and which the world's financially pressured shipping lines were keen to get rid of.

Under Sir Walter's direction USC brought the yard into the group and tendered for every scrap contract it could, generally being the winning bidder thanks to having a reliable end use for the scrapped steel; the groups ever hungry mills. The most famous ship to be scrapped there was undoubtedly RMS Olympic, although it was for the coup of scrapping the US Navy's BB-32, the USS Wyoming, that the yard was most notorious.


Although initially viewed with distrust by some in government, not least some in the Admiralty who feared their ships might be next, he was undoubtedly capable of spotting opportunities and turning around failing companies. Beaverbrook was betting he could also turn around a failing country. This already strong team was not yet complete and Beaverbrook would need to recruit one more member before his ministry was ready to make a real impact.

Up next: Mussolini's reply and Beaverbrook's recruit.