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Upon de-mobilisation the limitations of Liberal Coalition were becoming evident to the millions of working-class people thrown onto the dole queue and made dependent upon soup kitchens. This poverty was to co-exist with conspicuous consumption by others; as production grew along with trade and incomes. Inequality became increasingly noticeable as unrest swept across Europe, with communist revolution spreading from Russia to Germany.

The rise in unemployment saw the start of new protests, some of which had severe consequences for the participants. The Mayor of Stepney, Clement Attlee, led a demonstration into London during 1920. A year later, George Lansbury and other Poplar councillors were sent to prison for maintaining adequate unemployment benefits whilst adding to the burden on the rates.

On the parliamentary front, things were more sedate until 1922, when the Tories walked out of the governing coalition. With Lloyd George left stranded by an increasingly fragmented Liberal Party, Labour returned 142 MPs at the following election. This amounted to four and a quarter million votes.

The new leader was to be Ramsey MacDonald, whose war record indicated to new MPs that he was left-wing. From here, events snowballed, and within the year the tariff reform issue demanded another election. From this, Labour won 191 seats, and with the Liberals, were able to force a vote of no confidence in Stanley Baldwin, the Tory leader.

On January 22, 1924 George V sent for MacDonald to form the first Labour government. The early fear of the establishment was unjustified. No Labour leaders were contemplating revolution - in fact they were completely overawed by the whole process and trappings of power. Many of them had only just entered politics.

The achievements of the first Labour government were few. The ILP's John Wheatley managed to pass a Housing Act with Liberal support, whilst MacDonald combined the roles of Premier and Foreign Secretary with to some effect as a world peace-maker. Recognising reality, the Soviet Union was diplomatically acknowledged. The mainstream press, in response, became vicious and hostile.

A small Communist paper had began to be prosecuted for sedition, and when the Attorney-General withdrew proceedings after incompetent handling of the case, fuel was added to the rumours of a left-wing conspiracy. Another election was forced after Labour was defeated in the Commons due to Liberals capitulating to Establishment pressure. This election was to be based around fear of the 'Red Menace,' the Foreign Office discovering a letter from Soviet foreign minister Zinoviev to the British Communist Party, apparently inciting an armed revolt.

Labour lost 40 seats in this election, despite gaining over a million votes. The Liberals were reduced to nothing more than a rump, which they remain to this day and the forseeable future. With the Conservatives back in office, MacDonald came under fire from many in the movement. Yet events were to delay any efforts in extricating him from a position in which he had already become too comfortable.

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