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The First Labour PM and the Zinoviev Letter
In 1924 the Conservative government was defeated in the House of Commons and Stanley Baldwin resigned. King George V called on the Labour leader Ramsay MacDonald as the leader of the next biggest party and thus the first Labour government was formed. But it had little power because it did not have enough seats in the Commons and because the Conservatives dominated the Lords. However, Wheatley's Housing Act was recognised as a major piece of social legislation. Expectations amongst Britain's socialists were great but in fact MacDonald administration was careful not to alienate the electorate. Even so the Establishment had a great fear of socialism. They could see the results of Communism in Russia. MacDonald recognised the Soviet Government and started negotiations to retrieve debts which had been owed by the Soviet Union since the Tsar's days. The Russians were will willing to pay some money back but in return wanted a further loan. This was agreed. The Conservatives were outraged and MacDonald was forced to call a general election. Just before Polling Day a letter was sent to the Daily Mail and the Foreign Office, ostensibly written by a senior man in the Kremlin inciting the Communist Party of Great Britain to prepare for revolution. The Kremlin denounced it as a forgery but the damage was done. The Zinoviev Letter, as the incident was called, did few favours at the ballot box for Labour and the Conservative leader, Stanley Baldwin was returned as Prime Minister.
 
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