Editing James Callaghan (section)

==Prime Minister of the United Kingdom: 1976–1979<span class="anchor" id="Premiership"></span><!-- linked from redirects [[Premiership of James Callaghan]], [[Prime ministership of James Callaghan]] -->==
{{Further|Labour government, 1974–1979}}<!-- [[WP:NOTBROKEN]] -->
{{Infobox incumbency
| image        = James Callaghan ppmsca.53218 (cropped).tif
| caption      = Callaghan in 1977
| name         = Premiership of James Callaghan
| term_start   = 5 April 1976
| term_end     = 4 May 1979
| premier      = <!-- James Callaghan -->
| premier_link = Prime Minister of the United Kingdom
| cabinet      = [[Callaghan ministry]]
| party        = [[Labour Party (UK)|Labour Party]]
| election     = <!-- N/A -->
| monarch      = [[Elizabeth II]]
| seat         = [[10 Downing Street]]
| predecessor  = [[Second premiership of Harold Wilson|Harold Wilson]]
| successor    = [[Premiership of Margaret Thatcher|Margaret Thatcher]]
}}
Callaghan was the only prime minister to have held all three leading Cabinet positions{{snd}}chancellor of the exchequer, home secretary and foreign secretary{{snd}}prior to becoming prime minister.

On becoming Prime Minister, Callaghan immediately reshuffled the Cabinet: [[Anthony Crosland]] was given Callaghan's previous job as Foreign Secretary,  while [[Merlyn Rees]] became Home Secretary, replacing [[Roy Jenkins]] who Callaghan nominated to become [[President of the European Commission]]. Callaghan removed [[Barbara Castle]], with whom he had a poor relationship, from the Cabinet, and gave her job at social security to [[David Ennals]].{{sfn|Conroy|2006|pp=90–91}} 
[[File:President Jimmy Carter and Prime Minister James Callaghan.jpg|thumb|Callaghan (right) with US president [[Jimmy Carter]] in 1978]]

===IMF loan===
Callaghan came to office at a troubled time for the British economy, which was still recovering from the [[1973–1975 recession|1973–75 global recession]], and was beset by double-digit [[inflation]], and rising unemployment. Within months of entering office, his government was [[1976 sterling crisis|faced with a financial crisis]], which caused the Chancellor [[Denis Healey]] to ask the [[International Monetary Fund]] (IMF) for a large loan of $3900 million in order to maintain the value of [[pound sterling|sterling]]. The IMF demanded large cuts in public spending in return for the loan, which caused consternation among Labour's supporters. The Cabinet was split on the issue, and the left of the party led by [[Tony Benn]] put forward an [[Alternative Economic Strategy]] as a proposed alternative to the loan, which involved [[protectionism]], but this option was ultimately rejected. After tough negotiations, the government was able to negotiate a reduction in the proposed public spending cuts from £5000 million to £1,500 million in the first year, and then £1000 million a year over the next two years. In the event, it turned out that the loan had not been necessary, as it was based on an overestimation of the [[Public Sector Borrowing Requirement]] by the [[HM Treasury|Treasury]]: The government only had to draw on half of the loan, and it was paid back in full by 1979. By 1978, the economic situation showed signs of improvement, with unemployment falling, and inflation falling to single digits. Healey was able to introduce an expansionary budget in April 1978.<ref name="Thorpe70s"/>

Callaghan was widely judged to have handled the IMF crisis skilfully, avoiding any resignations from the Cabinet, and negotiating much lower spending cuts than had been originally demanded.<ref name="Thorpe70s"/>{{sfn|Conroy|2006|p=100}}

===Minority government===
Callaghan's time as prime minister was dominated by the troubles in running a government with a minority in the [[House of Commons of the United Kingdom|House of Commons]]: Labour had won a narrow majority of three seats at the [[October 1974 United Kingdom general election|October 1974 election]], however by April 1976, their overall majority had disappeared, due to by-election losses and the defection of two MPs to the breakaway [[Scottish Labour Party (1976)|Scottish Labour Party]], which left Callaghan heading a [[minority government]], forced to do deals with smaller parties in order to govern. An arrangement negotiated in March 1977 with [[Liberal Party (UK)|Liberal Party]] leader [[David Steel]], known as the [[Lib–Lab pact#1977|Lib–Lab pact]], lasted until August the following year. Deals were then forged with various small parties including the [[Scottish National Party]] (SNP) and the Welsh nationalist [[Plaid Cymru]], prolonging the life of the government. The nationalist parties, in turn, demanded [[devolution]] to their respective constituent countries in return for their supporting the government. When referendums for Scottish and Welsh devolution were held in March 1979 the [[1979 Welsh devolution referendum|Welsh devolution referendum]] saw a large majority vote against, while the [[1979 Scottish devolution referendum|Scottish referendum]] returned a narrow majority in favour, but failed to reach the required threshold of 40% of the electorate in support. When the Labour government duly refused to push ahead with setting up the proposed Scottish Assembly, the SNP withdrew its support for the government: this finally brought the government down as the Conservatives triggered a [[1979 vote of no confidence in the Callaghan ministry|vote of no confidence]] in Callaghan's government that was lost by a single vote on 28 March 1979, necessitating a [[1979 United Kingdom general election|general election]].<ref name="Thorpe70s">{{cite book |last1=Thorpe |first1=Andrew |title=A History of The British Labour Party |date=2001 |publisher=Palgrave |isbn=0-333-92908-X |pages=166–188}}</ref>

===Policies===
[[File:Persconferentie na afloop Overleg van de 9 , Den Haag Callaghan (oa met Enge, Bestanddeelnr 928-9157 (crop).jpg|thumb|Callaghan visiting [[The Hague]] in 1976]]
Callaghan's time as prime minister saw broad continuation of the policies which Labour had adopted since it had been elected in 1974 under Wilson. Callaghan continued the policies of the "[[Social Contract (Britain)|social contract]]" which sought to control inflation through a voluntary [[wage restraint]] agreement with the trade unions. Although the public spending cuts after 1976 made it more difficult for the government to deliver the increased benefits which had been promised as part of the package. Another policy continuation was the [[National Enterprise Board]] (NEB) which formed the centrepiece of the government's [[industrial policy]]. In practice, the NEB's main activity became one of rescuing failing companies.<ref name="Thorpe70s"/>

Despite its lack of Parliamentary majority, Callaghan's government was able to carry out a number of reforms in many areas (see [[Labour government, 1974–1979#Major contributions]]), among these was the [[Race Relations Act 1976]], which established the [[Commission for Racial Equality]] to promote racial equality.

In 1977 Callaghan's government [[nationalised]] the shipbuilding industry, creating [[British Shipbuilders]], and the aircraft industry, creating [[British Aerospace]].<ref name="Thorpe70s"/>

During his first year in office, Callaghan started what has since become known as 'The Great Debate', when he spoke at [[Ruskin College]], [[Oxford]], about the 'legitimate concerns' of the public about the quality of education in the nation's [[maintained school]]s. This discussion led to greater involvement of the government, through its ministries, in the curriculum and administration of state education, leading to the eventual introduction of the [[National curriculum]] some ten years later.<ref>{{cite news |last=Eason |first=Gary |url=http://news.bbc.co.uk/1/hi/education/4386373.stm |title=Callaghan's Great Education Debate |work=BBC News |date=27 March 2005 |access-date=30 April 2010 |archive-date=15 January 2009 |archive-url=https://web.archive.org/web/20090115082155/http://news.bbc.co.uk/1/hi/education/4386373.stm |url-status=live }}</ref> Early in his premiership he caused controversy with the appointment of [[Peter Jay (diplomat)|Peter Jay]], his then son-in-law as the [[British Ambassador to the United States]].

===Proposed 1978 election===
Over the summer of 1978, most opinion polls showed Labour with a lead of up to five points, and the expectation grew that Callaghan would call an autumn election which would have given him a second term in office until autumn 1983.<ref>{{cite news |last1=Clark |first1=Neil |title=How Jim Callaghan Changed the World |url=https://www.theguardian.com/commentisfree/2007/sep/20/howjimcallaghanchangedthe |access-date=3 November 2018 |work=The Guardian |date=20 September 2007 |archive-date=3 November 2018 |archive-url=https://web.archive.org/web/20181103210215/https://www.theguardian.com/commentisfree/2007/sep/20/howjimcallaghanchangedthe |url-status=live }}</ref><ref name="Thorpe70s"/> The economy had started to improve by this time: 1978 was a year of economic recovery for Britain, with inflation falling to single digits, unemployment declining during the year from a peak of 1.5 million in the third quarter of 1977, to 1.3 million a year later, and general living standards going up by more than 8%.<ref>Henry Pelling (1993), ''A Short History of the Labour Party'', p 171.</ref><ref name="Thorpe70s"/> Famously, he strung along the opposition and was expected to make his declaration of election in a broadcast on 7 September 1978.<ref>{{cite news|url=http://news.bbc.co.uk/onthisday/hi/dates/stories/september/7/newsid_2502000/2502781.stm|title=1978: Callaghan accused of running scared|work=On This Day|date=7 September 1978|access-date=28 March 2012|archive-date=10 April 2012|archive-url=https://web.archive.org/web/20120410202005/http://news.bbc.co.uk/onthisday/hi/dates/stories/september/7/newsid_2502000/2502781.stm|url-status=live}}</ref> Instead he announced that the election would be delayed until the following year, which was met with almost universal surprise.{{sfn|Conroy|2006|pp=109–116}} His decision not to call an election was seen by many as a sign of his dominance of the political scene and he ridiculed his opponents by singing old-time music hall star [[Vesta Victoria]]'s song "[[Waiting at the Church]]" at that month's [[Trades Union Congress]] meeting.<ref name="Beckett-461-462">{{cite book |first1=Andy |last1=Beckett |author-link=Andy Beckett |title=When the Lights Went Out. Britain in the Seventies |date= 2009 |publisher=[[Faber and Faber]] |pages=461–462}}</ref><ref>{{cite web |last1=Byrne |first1=Eugene |title=Waiting at the Church |url=https://www.historyextra.com/period/waiting-at-the-church/ |work=History Extra |date=4 November 2011|access-date=3 November 2018 |archive-date=3 November 2018 |archive-url=https://web.archive.org/web/20181103210126/https://www.historyextra.com/period/waiting-at-the-church/ |url-status=live }}</ref> This was celebrated by the TUC but has since been interpreted as a moment of [[hubris]].<ref>{{cite news |last1=Taylor |first1=Matthew |author-link=Matthew Taylor (political strategist) |title=Tony, you can leave the stage with them still wanting more |url=https://www.theguardian.com/commentisfree/2007/jan/07/comment.politics1 |access-date=3 November 2018 |work=The Guardian |date=7 January 2007 |archive-date=3 November 2018 |archive-url=https://web.archive.org/web/20181103210155/https://www.theguardian.com/commentisfree/2007/jan/07/comment.politics1 |url-status=live }}</ref> Callaghan intended to convey the message that he had not promised an election.<ref name="Beckett-461-462"/>

Callaghan's failure to call an election during 1978 was later widely seen as a political miscalculation;<ref name="Beckett-463">{{cite book |first1=Andy |last1=Beckett |author-link=Andy Beckett |title=When the Lights Went Out. Britain in the Seventies |date= 2009 |publisher=[[Faber and Faber]] |page=463}}</ref> indeed, he himself later admitted that not calling an election was an error of judgement. However, private polling by the Labour Party in the autumn of 1978 had shown the two main parties with about the same level of support.<ref>{{cite book |first1=Andy |last1=Beckett |author-link=Andy Beckett |title=When the Lights Went Out. Britain in the Seventies |date= 2009 |publisher=[[Faber and Faber]] |page=460}}</ref>

===Winter of Discontent===
{{Main|Winter of Discontent}}
[[File:Carter guadeloupe cropped.png|thumb|Callaghan (right) with [[Helmut Schmidt]], [[Jimmy Carter]] and [[Valéry Giscard d'Estaing]] in [[Guadeloupe]], 1979]]
Callaghan's method of dealing with the long-term economic difficulties involved [[Social Contract (Britain)|wage restraint]], which had been operating for four years with reasonable success. He gambled that a fifth year would further improve the economy and allow him to be re-elected in 1979, and so he attempted to hold pay rises to 5% or less. The trade unions rejected continued wage restraint and in a wave of widespread strikes over the winter of 1978–79 (known as the [[Winter of Discontent]]) secured higher pay. The industrial unrest made his government unpopular, and Callaghan's response to one interview question only made it worse. Returning to the United Kingdom from the [[Guadeloupe Conference]] in January 1979, Callaghan was asked, "What is your general approach, in view of the mounting chaos in the country at the moment?" Callaghan replied, "Well, that's a judgement that you are making. I promise you that if you look at it from outside, and perhaps you're taking rather a parochial view at the moment, I don't think that other people in the world would share the view that there is mounting chaos." This reply was reported in ''[[The Sun (United Kingdom)|The Sun]]'' under the headline "Crisis? What Crisis?".<ref>{{cite news |url=http://news.bbc.co.uk/1/hi/uk_politics/921524.stm |title=Crisis? What crisis? |work=BBC News |date=12 September 2000 |access-date=29 May 2019 |archive-date=6 January 2018 |archive-url=https://web.archive.org/web/20180106231711/http://news.bbc.co.uk/1/hi/uk_politics/921524.stm |url-status=live }}</ref> Callaghan also later admitted in regard to the Winter of Discontent that he had "let the country down".<ref>Peter Hennessy (2001), ''The Prime Minister'', p. 377.</ref>

===1979 general election===
{{main|1979 United Kingdom general election}}
The Winter of Discontent saw Labour's performance slump dramatically in the opinion polls. They had topped most of the pre-winter opinion polls by several points, but in February 1979 at least one opinion poll was showing the Conservatives 20 points ahead of Labour and it appeared inevitable that Labour would lose the forthcoming election.<ref>{{cite web |url=http://www.ipsos-mori.com/newsevents/ca/ca.aspx?oItemId=193 |title=Comment & Analysis &#124; New Labour And Delivery |publisher=Ipsos MORI |date=15 May 2004|access-date=28 March 2012 |archive-url=https://web.archive.org/web/20120717025821/http://www.ipsos-mori.com/newsevents/ca/ca.aspx?oItemId=193 |archive-date=17 July 2012 |url-status=dead  }}</ref>

In the buildup to the election, the ''[[Daily Mirror]]'' and ''[[The Guardian]]'' supported Labour, while ''The Sun'', the ''[[Daily Mail]]'', the ''[[Daily Express]]'', and ''[[The Daily Telegraph]]'' supported the Conservatives.<ref>{{cite news | url=https://www.theguardian.com/news/datablog/2010/may/04/general-election-newspaper-support#zoomed-picture | work=The Guardian | first=Katy | last=Stoddard | title=Newspaper support in UK general elections | date=4 May 2010 | access-date=14 December 2016 | archive-date=1 August 2013 | archive-url=https://web.archive.org/web/20130801141949/http://www.theguardian.com/news/datablog/2010/may/04/general-election-newspaper-support#zoomed-picture | url-status=live }}</ref>

[[File:Votes by party in the 1979 vote of no confidence against the government of James Callaghan.png|left|thumb|Votes by party in the [[1979 vote of no confidence in the Callaghan ministry]]. The motion passed by one vote.]]
On 28 March 1979, the House of Commons passed a [[1979 vote of no confidence in the Callaghan ministry|motion of no-confidence by one vote]], 311–310, which forced Callaghan to call a [[1979 United Kingdom general election|general election]] which was held on 3 May.<ref>{{cite news |url=http://news.bbc.co.uk/onthisday/hi/dates/stories/march/28/newsid_2531000/2531007.stm |title=1979: Early election as Callaghan defeated |work=On this Day |access-date=29 March 2009 |date=28 March 1979 |archive-date=9 December 2017 |archive-url=https://web.archive.org/web/20171209004131/http://news.bbc.co.uk/onthisday/hi/dates/stories/march/28/newsid_2531000/2531007.stm |url-status=live }}</ref> The Conservatives under [[Margaret Thatcher]] ran a campaign on the slogan "[[Labour Isn't Working]]". Although Callaghan remained personally more popular with the electorate than Thatcher, the Conservatives won the election with an overall majority of 43 seats.<ref>{{cite web |title=Election 1979 Results |url=https://www.electionpolling.co.uk/results/1979 |publisher=Election Polling |access-date=9 November 2024}}</ref><ref>{{cite web |title=The Election of 1979 |url=https://thepoliticsteacherorg.thepoliticsteacher.org/home/a-and-as-politics-2017/unit-1-politics-in-the-uk-year-12--13/voting-behaviour-and-the-media/the-election-of-1979 |publisher=The Politics Shed |access-date=9 November 2024}}</ref> The Labour vote held up, with the party winning a similar number of votes to 1974, however the Conservatives benefited from a surge in turnout.<ref>{{cite web |title=General Election 1979 |url=https://www.studysmarter.co.uk/explanations/history/modern-britain/general-election-1979/ |publisher=StudySmarter |access-date=3 November 2024}}</ref>

During the 1979 election campaign, Callaghan detected a sea-change in public opinion, which he privately opined:<ref name="JCquotes">{{cite news |title=Jim Callaghan: A life in quotes |date=26 March 2005 |url=http://news.bbc.co.uk/2/hi/uk_news/politics/3288907.stm |publisher=BBC |access-date=22 August 2024}}</ref>

<blockquote> "You know there are times, perhaps once every thirty years, when there is a sea-change in politics. It then does not matter what you say or what you do. There is a shift in what the public wants and what it approves of. I suspect there is now such a sea change and it is for Mrs Thatcher." </blockquote>

After losing power in 1979, Labour spent the next 18 years in opposition, pejoratively described as the period in wilderness for the party.<ref>{{cite news | url=http://news.bbc.co.uk/1/hi/3067563.stm | work=BBC News | first=Paul | last=Wilenius | title=Enemies within: Thatcher and the unions | date=5 March 2004 | access-date=6 May 2011 | archive-date=18 February 2020 | archive-url=https://web.archive.org/web/20200218003411/http://news.bbc.co.uk/1/hi/3067563.stm | url-status=live }}</ref>