Rather than trying to bring the Liberals back into government, Asquith's motivation for permitting Labour to enter power was that he hoped they would prove to be incompetent and quickly lose support.

Mr. Baldwin had indeed succeeded in negotiating (January 1923) a settlement of the British debt to the United States, but on terms which involved an annual payment of £34 million, at the existing rate of exchange.

Peace had not yet been made with Turkey; unemployment was a standing menace to national recovery; there was continued unrest among the wage-earners, and a significant strike among farm labourers in Norfolk.

Confronted by these difficulties, convinced that economic conditions in England called for a drastic change in fiscal policy, and urged thereto by the Imperial Conference of 1923, Mr. Baldwin decided to ask the country for a mandate for Preference and Protection.

A reformation of the Conservative-Liberal coalition which had governed the country from 1918 to 1922 was not practical, as Baldwin had alienated both of the two most prominent Liberals, Asquith and David Lloyd George.