The Liberal Party was one of the two major political parties in the United Kingdom, along with the Conservative Party, in the 19th and early 20th centuries. Beginning as an alliance of Whigs, free trade-supporting Peelites, and reformist Radicals in the 1850s, by the end of the 19th century, it had formed four governments under William Ewart Gladstone. Despite being divided over the issue of Irish Home Rule, the party returned to government in 1905 and won a landslide victory in the 1906 general election. Under prime ministers Henry Campbell-Bannerman (1905–1908) and H. H. Asquith (1908–1916), the Liberal Party passed reforms that created a basic welfare state.Martin Pugh, "Lloyd George, David, 1st Earl Lloyd-George", The Oxford Companion to British History, p. 565, quote: "Lloyd George made a greater impact on British public life than any other 20th-century leader, thanks to his pre-war introduction of Britain's social welfare system (especially medical insurance, unemployment insurance, and old-age pensions, largely paid for by taxes on high incomes and on the land)." Although Asquith was the party leader, its dominant figure was David Lloyd George.

Asquith was overwhelmed by his wartime role as prime minister and Lloyd George led a coalition that replaced him in late 1916. However, Asquith remained as Liberal Party leader. The split between Lloyd George's breakaway faction and Asquith's official Liberal faction badly weakened the party.Michael Fry, "Political Change in Britain, August 1914 to December 1916: Lloyd George Replaces Asquith: The Issues Underlying the Drama". Historical Journal (1988) 31#3: 609–627. The coalition government of Lloyd George was increasingly dominated by the Conservative Party, which finally ousted him as prime minister in 1922. The subsequent Liberal collapse was quick and catastrophic. With 397 MPs elected in the 1906 election; they had only 40 in 1924. Their share of the popular vote plunged from 49% to 18%. The Labour Party absorbed most of the ex-Liberal voters and then became the Conservatives' main rival.Keith Laybourn, "The Rise of Labour and the Decline of Liberalism" (1995) p. 207.

By the 1950s, the party had won as few as six seats at general elections. Apart from a few notable by-election victories, its fortunes did not improve significantly until it formed the SDP–Liberal Alliance with the newly formed Social Democratic Party (SDP) in 1981. At the 1983 general election, the Alliance won over a quarter of the vote, but won only 23 of the 633 seats it contested. At the 1987 general election, its share of the vote fell below 23%. Further, the Liberals and the SDP merged in 1988 to form the Social and Liberal Democrats (SLD), who the following year were renamed the Liberal Democrats. A splinter group reconstituted the Liberal Party in 1989.D.A. Hamer, Liberal Politics in the Age of Gladstone and Rosebery (1972) pp. 1–27.

The Liberals were a coalition with diverse positions on major issues and no unified national policy. This made them repeatedly liable to deep splits, such as that of the Liberal Unionists in 1886 (they eventually joined the Conservative Party); the faction of labour union members that joined the new Labour Party; the split between factions led by Asquith and that led by Lloyd George in 1918–1922; and a three-way split in 1931.Chris Cook, A Short History of the Liberal Party (7th ed. 2010) Many prominent intellectuals were active in the party, including philosopher John Stuart Mill, economist John Maynard Keynes, and social planner William Beveridge. Winston Churchill during his years as a Liberal (1904–1924) authored Liberalism and the Social Problem (1909).William C. Lubenow, Liberal intellectuals and public culture in modern Britain, 1815–1914: making words flesh (Boydell & Brewer, 2010).

History Origins

The Liberal Party grew out of the Whigs, who had their origins in an aristocratic faction in the reign of Charles II, and the early 19th century Radicals. The Whigs were in favour of reducing the power of the Crown and increasing the power of Parliament. Although their motives in this were originally to gain more power for themselves, the more idealistic Whigs gradually came to support an expansion of democracy for its own sake. The great figures of reformist Whiggery were Charles James Fox (died 1806) and his disciple and successor Earl Grey. After decades in opposition, the Whigs returned to power under Grey in 1830 and carried the First Reform Act in 1832.

The Reform Act was the climax of Whiggism, but it also brought about the Whigs' demise. The admission of the middle classes to the franchise and to the House of Commons led eventually to the development of a systematic middle-class liberalism and the end of Whiggery, although for many years reforming aristocrats held senior positions in the party. In the years after Grey's retirement, the party was led first by Lord Melbourne, a fairly traditional Whig, and then by Lord John Russell, the son of a Duke but a crusading radical, and by Lord Palmerston, a renegade Irish Tory and essentially a conservative, although capable of radical gestures.

As early as 1839, Russell had adopted the name of "Liberals"; in reality, his party was a loose coalition of Whigs in the House of Lords and Radicals in the Commons. The leading Radicals were John Bright and Richard Cobden, who represented the manufacturing towns which had gained representation under the Reform Act. They favoured social reform, personal liberty, reducing the powers of the Crown and the Church of England (many Liberals were Nonconformists), avoidance of war and foreign alliances (which were bad for business) and above all free trade. For a century, free trade remained the one cause which could unite all Liberals.

In 1841, the Liberals lost office to the Conservatives under Sir Robert Peel. However, their period in opposition was short because the Conservatives split over the repeal of the Corn Laws, a free trade issue; and a faction known as the Peelites (but not Peel himself, who died soon after) aligned to the Liberal side on the issue of free trade. This allowed ministries led by Russell, Palmerston and the Peelite Lord Aberdeen to hold office for most of the 1850s and 1860s. A leading Peelite was William Gladstone, who was a reforming Chancellor of the Exchequer in most of these governments. The formal foundation of the Liberal Party is traditionally traced to 1859 when the remaining Peelites, Radicals and Whigs agreed to vote down the incumbent Conservative government. This meeting was held at the Willis' rooms in London on 6 June 1859. This led to Palmerston's second government.

However, the Whig-Radical amalgam could not become a true modern political party while it was dominated by aristocrats and it was not until the departure of the "Two Terrible Old Men", Russell and Palmerston, that Gladstone could become the first leader of the modern Liberal Party. This was brought about by Palmerston's death in 1865 and Russell's retirement in 1868. After a brief Conservative government (during which the Second Reform Act was passed by agreement between the parties), Gladstone won a huge victory at the 1868 election and formed the first Liberal government. The establishment of the party as a national membership organisation came with the foundation of the National Liberal Federation in 1877. The philosopher John Stuart Mill was also a Liberal MP from 1865 to 1868.

Gladstone era

For the next 30 years, Gladstone and Liberalism were synonymous. William Gladstone served as prime minister four times (1868–74, 1880–85, 1886, and 1892–94). His financial policies, based on the notion of balanced budgets, low taxes and laissez-faire, were suited to a developing capitalist society, but they could not respond effectively as economic and social conditions changed. Called the "Grand Old Man" later in life, Gladstone was always a dynamic popular orator who appealed strongly to the working class and to the lower middle class. Deeply religious, Gladstone brought a new moral tone to politics, with his evangelical sensibility and his opposition to aristocracy.J. P. Parry, Democracy and Religion: Gladstone and the Liberal Party, 1867–1875 (1989), p. 174. His moralism often angered his upper-class opponents (including Queen Victoria), and his heavy-handed control split the Liberal Party.H. C. G. Matthew, "Gladstone, William Ewart (1809–1898)", Oxford Dictionary of National Biography (2004).J. L. Hammond and M. R. D. Foot, Gladstone and Liberalism (1952).

In foreign policy, Gladstone was in general against foreign entanglements, but he did not resist the realities of imperialism. For example, he ordered the occupation of Egypt by British forces in the 1882 Anglo-Egyptian War.R. C. Mowat, "From Liberalism to Imperialism: The Case of Egypt 1875–1887", Historical Journal 16#1 (1973), pp. 109–124 focus on Lord Cromer as a Liberal imperialist. online. His goal was to create a European order based on co-operation rather than conflict and on mutual trust instead of rivalry and suspicion; the rule of law was to supplant the reign of force and self-interest. This Gladstonian concept of a harmonious Concert of Europe was opposed to and ultimately defeated by a Bismarckian system of manipulated alliances and antagonisms.Graham D. Goodlad, British foreign and imperial policy, 1865–1919 (2000), p. 21.

As prime minister from 1868 to 1874, Gladstone headed a Liberal Party which was a coalition of Peelites like himself, Whigs and Radicals. He was now a spokesman for "peace, economy and reform". One major achievement was the Elementary Education Act 1870 (33 & 34 Vict. c. 75), which provided England with an adequate system of elementary schools for the first time. He also secured the abolition of the purchase of commissions in the British Army and of religious tests for admission to Oxford and Cambridge; the introduction of the secret ballot in elections; the legalization of trade unions; and the reorganization of the judiciary in the Judicature Act.

Regarding Ireland, the major Liberal achievements were land reform, where he ended centuries of landlord oppression, and the disestablishment of the (Anglican) Church of Ireland through the Irish Church Act 1869.

In the 1874 general election, Gladstone was defeated by the Conservatives under Benjamin Disraeli during a sharp economic recession. He formally resigned as Liberal leader and was succeeded by the Marquess of Hartington, but he soon changed his mind and returned to active politics. He strongly disagreed with Disraeli's pro-Ottoman foreign policy and in 1880 he conducted the first outdoor mass-election campaign in Britain, known as the Midlothian campaign. The Liberals won a large majority in the 1880 election. Hartington ceded his place and Gladstone resumed office.

Ireland and Home Rule