ABSTRACT
The Labour government inherited substantial economic problems from the Conservatives when it came into office in 1964. Although British capitalism had expanded massively in the post-war boom, the rate of expansion had started to slow by the early 1960s putting Britain in a weaker position in relation to its international rivals. According to Clive Ponting, ‘[l]ow investment, wages rising faster than productivity growth and the handicap of a large number of declining industries (and an overvalued pound) lay at the root of Britain’s economic problems’.1 In other words, structural economic difficulties were to blame for poor economic growth, a declining rate of profit and an increasing rate of inflation.
