EDWARD HUGH JOHN NEALE DALTON, BARON DALTON PC (16 August 1887 – 13
February 1962) was a British Labour Party economist and politician who
Chancellor of the Exchequer from 1945 to 1947. He shaped
Labour Party foreign-policy in the 1930s, opposed pacifism, promoted
rearmament against the German threat, and strongly opposed the
appeasement policy of Prime Minister
Neville Chamberlain in 1938. He
served in Churchill's wartime coalition cabinet. As Chancellor, he
pushed his cheap money policy too hard, and mishandled the sterling
crisis of 1947. Dalton's political position was already in jeopardy in
1947, when, he, seemingly inadvertently, revealed a sentence of the
budget to a reporter minutes before delivering his budget speech.
His biographer Ben Pimlott characterised Dalton as peevish, irascible, given to poor judgment and lacking administrative talent. He also recognised that Dalton was a genuine radical and an inspired politician; a man, to quote his old friend and critic John Freeman , "of feeling, humanity, and unshakeable loyalty to people which matched his talent."
* 1 Early life
* 2 Political career
* 2.1 Foreign policy
* 3 Second World War
* 4.1 Return to cabinet
* 5 Awards and personal life * 6 Contributions in economics * 7 Notes
* 8 Further reading
* 8.1 Primary sources
* 9 References * 10 External links
Dalton was educated at Summer Fields School and then at Eton College , where he was head of his house, but was disappointed not to be elected to "Pop". He went up to King\'s College, Cambridge , where he was active in student politics and his socialist views, then very rare amongst undergraduates, earned him the nickname "Comrade Hugh". Whilst at Cambridge he was President of the Cambridge University Fabian Society . He did not succeed in becoming President of the Cambridge Union Society , despite three unsuccessful attempts to be elected Secretary.
He went on to study at the
London School of Economics
Hugh Dalton, right, Minister of Economic Warfare, and Colin Gubbins, chief of SOE, talking to a Czech officer during a visit to Czech troops near Leamington Spa, Warwickshire
Dalton stood unsuccessfully for Parliament four times: at the Cambridge by-election, 1922 , in Maidstone at the 1922 general election , in Cardiff East at the 1923 general election , and the Holland with Boston by-election, 1924 , before entering Parliament for Peckham at the 1924 general election .
At the 1929 general election , he succeeded his wife
Ruth Dalton as
Member of Parliament (MP) for Bishop Auckland in 1929. Widely
respected for his intellectual achievements in economics, he rose in
the Labour Party's ranks, with the election in 1925 to the shadow
cabinet and, with strong union backing, to the Labour Party national
executive committee (NEC). He gained ministerial and foreign policy
experience as Under-Secretary at the Foreign Office in MacDonald's
Second Government, 1929–31. He lost the position when he, and most
Labour leaders, rejected the national government of Prime Minister
Dalton in 1935 published _Practical Socialism for Britain_, a bold and highly influential assessment of a future Labour government's policy options. The book revived updated nuts-and-bolts Fabianism, which had been out of favour, and could be used to attack the more militant Left. His emphasis was on using the state as a national planning agency, an approach that appealed well beyond Labour.
Turning his attention to the looming crisis in Europe, he became the
Labour Party's spokesman on foreign policy in Parliament. Pacifism had
been a strong element in Labour Party (and other parties as well), but
Spanish Civil war
SECOND WORLD WAR
When war came, Chamberlain's position became untenable after many
Conservative MPs refused to support him in the
Norway Debate in April
1940, and Dalton and other senior Labour leaders made clear they would
join any coalition government _except_ one headed by Chamberlain.
After Chamberlain resigned early in May, and Lord Halifax had declined
CHANCELLOR OF THE EXCHEQUER
Main article: Political history of the United Kingdom (1945–present)
After the unexpected Labour victory in the 1945 general election ,
Dalton wished to become Foreign Secretary, but instead the job was
The Treasury faced urgent problems. Half of the wartime economy had been devoted to mobilizing soldiers, warplanes, bombs and munitions; an urgent transition to a peacetime budget was necessary, while minimizing inflation. Financial aid through Lend Lease from the United States was abruptly and unexpectedly terminated in September 1945, and new loans from the United States and Canada were essential to keep living conditions tolerable. In the long run, Labour was committed to nationalization of industry and national planning of the economy, to more taxation of the rich and less of the poor, and to expanding the welfare state and creating free medical services for everyone. Dalton in 1962
During the war most overseas investments had been sold to pay for the
war (thus losing their income), and Britain suffered severe balance of
payments problems. The $3.75 billion 50-year American loan negotiated
John Maynard Keynes in 1946 (and the $1.25 billion loan from
Canada) was soon exhausted. By 1947 rationing had to be tightened and
the convertibility of the pound suspended. In the atmosphere of crisis
Herbert Morrison and
An important goal for Dalton in 1945–47 was cheaper money—that is, low interest rates. He wanted to avoid the high interest rates and unemployment experienced after the First World War and to keep down the cost of nationalization. Dalton gained support for this cheaper money policy from John Maynard Keynes as well as officials from the Bank of England and the Treasury.
Budgetary policy under Dalton was strongly progressive, as characterised by policies such as increased food subsidies, heavily subsidised rents to council house tenants, the lifting of restrictions of house-building, the financing of national assistance and family allowances, and extensive assistance to rural communities and Development Areas. Dalton was also responsible for funding the introduction of Britain's universal family allowances scheme, doing so "with a song in my heart," as he later put. In one of his budgets, Dalton significantly increased spending on education (which included £4 million for the universities and the provision of free school milk), £38 million for the start (from August 1946) of family allowances, and an additional £10 million for Development Areas. In addition, the National Land Fund was established. Harold Macmillan, who inherited Dalton's housing responsibilities, later acknowledged his debt to Dalton's championing of New Towns, and was grateful for the legacy of Dalton's Town Development Bill, which encouraged urban overfill schemes and the movement of industry out of cities.
Food subsidies were maintained at high wartime levels in order to restrain living costs, while taxation structures were altered to benefit low-wage earners, with some 2.5 million workers taken out of the tax system altogether in Dalton's first two budgets. There were also increases in surtax and death duties, which were opposed by the Opposition. According to one historian, Dalton's policies as Chancellor reflected "an unprecedented emphasis by central government on the redistribution of income".
Walking into the House of Commons to give the autumn 1947 Budget speech, he made an off-the-cuff remark to a journalist, telling him of some of the tax changes in the budget. The news was printed in the early edition of the evening papers before he had completed his speech, and whilst the stock market was still open. This led to his resignation for leaking a Budget secret; he was succeeded by Stafford Cripps . Though initially implicated in the allegations that led to the Lynskey tribunal in 1948, he was ultimately exonerated.
RETURN TO CABINET
The paved surface of the Pennine Way on Black Hill
In 1948 he returned to the Cabinet as Chancellor of the Duchy of
Lancaster , making him a minister without portfolio. He became
Minister of Town and Country Planning in 1950, renamed as Minister of
Local Government and Planning in 1951. An avid outdoorsman, he served
a term as president of the
AWARDS AND PERSONAL LIFE
He was president of the Ramblers\' Association from 1948 to 1950 and Master of the Drapers\' Company in 1958–59. He was made a life peer as BARON DALTON, of Forest and Frith in the County Palatine of Durham in 1960.
Although Dalton was married and had a daughter who died in infancy in the early 1920s, his biographer Ben Pimlott and various other sources suggested that he was a repressed homosexual. As a young man, Dalton was close to the poet Rupert Brooke , who died in 1915, and in later years, he acted as a mentor to various handsome young men – who were almost uniformly heterosexual. One notable beneficiary of Dalton's support was Anthony Crosland , whom Dalton talent-spotted at the Oxford Union in 1946 and whose selection for a winnable seat for the 1950 General Election Dalton later helped to arrange.
His papers, including his diaries, are held at the London School of Economics Library.
CONTRIBUTIONS IN ECONOMICS
Dalton substantially expanded Max Otto Lorenz 's work in the measurement of income inequality, offering both an expanded array of techniques but also a set of principles by which to comprehend shifts in an income distribution, thereby providing a more compelling theoretical basis for understanding relationships between incomes (1920).
Following a suggestion by Pigou (1912, p. 24), Dalton proposed the
condition that a transfer of income from a richer to a poorer person,
so long as that transfer does not reverse the ranking of the two, will
result in greater equity (Dalton, p. 351). This principle has come to
be known as the
Pigou–Dalton principle (see, e.g.,
Dalton offered a theoretical proposition of a positive functional relationship between income and economic welfare, stating that economic welfare increases at an exponentially decreasing rate with increased income, leading to the conclusion that maximum social welfare is achievable only when all incomes are equal (Rogers, 2004).
* ^ David Loades, ed., _Readers Guide to British History_ (2003) vol 1 p 329 * ^ Pimlott, B. _Hugh Dalton_ (London: Cape, 1985), p. 639. * ^ LSE Archives * ^ Great Britain. Committee on Industry and Trade, _Factors in industrial and commercial efficiency_ (London: HMSO, 1927), ii. * ^ Ben Pimlott, _Oxford Dictionary of National Biography_ (2004) * ^ Kenneth O. Morgan, _Labour in Power: 1945–1951_ (1985) ch 2 * ^ Ben Pimlott, "Dalton, (Edward) Hugh Neale, Baron Dalton (1887–1962)," _Oxford Dictionary of National Biography_ (2004) * ^ Susan Howson, "The Origins of Cheaper Money, 1945-7," _Economic History Review_ (1987) 40#3 pp. 433–452 in JSTOR * ^ Labour in Government, 1945–1951 by Kenneth Morgan * ^ Nicholas Timmins, _The Five Giants: A Biography of the Welfare State_ * ^ Francis Beckett, _Clem Attlee_ * ^ Ben Pimlott, _Hugh Dalton_ * ^ Kevin Jefferys, _The Attlee Governments 1945–1951_ * ^ Matthew Hilton; et al. (2012). _A Historical Guide to NGOs in Britain: Charities, Civil Society and the Voluntary Sector since 1945_. Palgrave Macmillan. p. 187. * ^ http://hansard.millbanksystems.com/lords/1960/feb/03/lord-dalton * ^ https://www.theguardian.com/books/2015/may/16/double-lives-a-history-of-sex-and-secrecy-at-westminster
* Brady, Robert A. (1950). _Crisis in Britain: Plans and Achievements of the Labour Government_. University of California Press. , detailed coverage of nationalisation, welfare state and planning * Dell, Edmund. _The Chancellors: A History of the Chancellors of the Exchequer, 1945-90_ (HarperCollins, 1997) pp 15–93. * Morgan, Kenneth O. _Labour in Power 1945–51_ (1984). * Pelling, Henry. _The Labour Government 1945–51_ (1984) * Pimlott, Ben. _Hugh Dalton_ (1985), awarded the Whitbread Prize * Pimlott, Ben. "Dalton, (Edward) Hugh Neale, Baron Dalton (1887–1962)", _Oxford Dictionary of National Biography_, Oxford University Press, 2004; online edn, Jan 2011 accessed 4 June 2013 * Howe, Stephen. "Hugh Dalton" in Kevin Jefferys, ed., _Labour Forces: From Ernie Bevin to Gordon Brown_ (2002) pp 43–62
* Dalton, Hugh. _Call back yesterday: memoirs, 1887–1931_ (1953) · * Dalton, Hugh. _The fateful years: memoirs, 1931–1945_ (1957) * Dalton, Hugh. _High tide and after: memoirs, 1945–1960_ (1962) * Pimlott, Ben, ed. _Second World War Diary of Hugh Dalton, 1940–45_ (1986) 913pp * Pimlott, Ben, ed. _The political diary of Hugh Dalton, 1918–1940, 1945–1960_ (1986)
* Craig, F. W. S. (1983) . _British parliamentary election results 1918–1949_ (3rd ed.). Chichester: Parliamentary Research Services. ISBN 0-900178-06-X . * Rogers, F. H. (2004). _The Measurement and Decomposition of Achievement Equity_. Unpublished doctoral dissertation. Columbus, Ohio: Ohio State University. * Dalton, H. _The measurement of the inequality of incomes_, Economic Journal, 30 (1920), pp. 348–461.
* Works by