Norman Stone - The Atlantic and Its Enemies

It was true that America was experiencing tissue regeneration under all of this. Whereas in other countries people tended to stay close to where they were born, Americans packed their bags and moved. Modern industries could shift, given air-conditioning technology, to the old South, the south-west and California, now gaining population at the expense of the north-east, and by 1964 California, with 30 million people, had become the largest state, Texas soon following. Shoots of ultramodern industry were coming up, and much ingenuity was shown as regards substitutes for oil. But the middle and later seventies were a demoralizing period.

The overall Atlantic crisis was displayed at its worst in England, where the entire civilization had — with a Dutch contribution — started. The positive sides were enormous: the rule of law, the Industrial Revolution, a habit of non-violence in politics. France, rights of man and all, had not contributed anything like so much to the world and, comparing British experience with French, Edmund Burke had said, ‘We go from light to light; we compromise, we reconcile, we balance.’ In the nineteenth century the British had had to face the problems of the modern world, the organization of what came to be called ‘mass society’. They had done so, preserving and adapting old institutions, using them for new purposes. For instance, local administration was carried out through the vestry, and the Church of England had a social role; the colleges of Oxford and Cambridge, which were originally religious places, of a sort that collapsed on the Continent, made for world-class universities. The oldest and most adaptable of these institutions was of course the monarchy itself, and in 1953, when Queen Elizabeth II was crowned, complete with archbishop, sacred oil, orbs and sceptres, it was an extraordinary spectacle, watched by tens of millions on the relatively new black-and-white television sets. A film-maker of genius, Lindsay Anderson, remarked, later on, that the monarchy was a gold filling in a mouthful of rotten teeth. That fitted the England that emerged, a generation after the coronation. However, the early fifties were a good time. Western Europe was not yet quite competitive, British exports did well, and there were good markets in the old imperial area. Decolonization during the 1950s had been, at least in comparison with French experience, a success, and the new Queen became a considerable expert in it. At home, taxes on income were absurdly high, but there was no tax on fortunes made out of equities, and the banks were generous with overdrafts, charging a low rate of interest. The old England (and Scotland) had an Indian summer, and the great Victorian cities, with Glasgow in the lead, were still the great Victorian cities of industry and empire. But the later fifties showed that this could not last.

Her worldwide troubles in 1947 had led to the creation of an Atlantic system; now, her domestic ones revealed its central weaknesses. The great British economist John Maynard Keynes had somehow lent his name to the Pursuit of Happiness: he could reconcile welfare with progress. Government waved its wand, the poor had money transferred to them from the rich, spenders were encouraged rather than savers, the economy grew accordingly, and unemployment was kept low. ‘Keynesianism’, though no-one could quite pin down the Master, reigned, and dissident economists were unfashionable, or even slightly ridiculous. Their chief argument against Keynesianism was that it would promote inflation: if governments overtaxed then money would go abroad, and an overhang of paper money would translate into higher prices; in the end, when workers, through trade unions, wanted higher wages to defend themselves against a rising of basic prices, then they would expect inflation in the future, and want even higher wages. That would in turn add to the paper money and to the inflation. There were a few bright sparks who suggested that there was a relationship between the amount of paper money and pyramids of credit on the one side, and rising prices on the other. This was called ‘monetarism’. Such bright sparks were not fashionable. In the sixties, the Keynesians made the running, had the answers, were constantly in the newspapers and on television, and then, in the seventies, ran into very choppy waters.

The oil crisis had its worst effects here, and the quadrupling of energy prices pushed England into a trouble that called in question the whole post-war order. Strikes in the seventies meant that the average worker was not working for nearly a fortnight every year (‘average’ is not the right word: large unions alone were involved, and not all of them) whereas in the fifties the figure had been three days. The Prime Minister, Edward Heath, who had the face of a large and angry baby, would harangue the nation on a television that was switched off after 10 p.m. In 1974 he launched an election distinguished by the abstention of 2 million of his natural supporters, lost, and was replaced by a man who pandered to the unions. The Stock Exchange sank to a pitiful level and banks went under. The country was about one third as well-off as Germany, and in parts of the North there were areas that even resembled Communist Poland. In 1970 a rising figure in the political-media world of London, Ferdinand Mount, remembered that, from the capital, ‘the main railway line to the north passed through great swathes of devastation — industrial wastelands with rows of roofless workshops — the roofs had been removed in order to avoid taxes’. Why had this decline come about, in a country which, after the war, had been still the second-greatest exporter in the world? It was partly that the pound had become a very strong currency, and latterly because there was oil in the North Sea, but the fall of exports was really to do with ‘poor quality, late delivery, trade union restrictions, timid and defeatist management’. In fact Keynes himself, towards the end of the war, had bitterly hoped that the Germans would still have enough bombing power to obliterate some of the worst-managed industries. As things were, the obliteration happened painfully a generation later.

There was of course a great British problem, that the old industries had been the very first in the world, and, to a lesser extent, that their old markets were declining. In its way, the London Underground symbolized the entire national problem. It had been the first network in the world and was a triumph of engineering in the 1860s. But back then tunnels had to be extremely deep, whereas a generation later engineering had advanced and the Paris metro, say, was far shallower. London was stuck with a museum piece, and still is (the government at the time of the Millennium opting, quite characteristically for governments of the epoch, to build an entirely pointless structure, the Dome, at great expense instead of appealing to Londoners to put up with trouble for five years in order to have a state-of-the-art transport system). British industry entered upon a decline, and the means selected to stop it only made things worse. The facts were indeed as Ferdinand Mount had said, an awful litany of uncompetitiveness, and it had happened to other country-empires in the past. An economic pundit of the sixties, Thomas Balogh, opined that England was going the way of Spain: she too had run an empire upon which the sun never set, and in the seventeenth century had declined very rapidly, as the contrast, to this day, of North and South America shows. But this was the wrong parallel. There was a much closer one, with Holland. The British Empire had not been, like Spain’s, a military-religious affair, involving wide settlement and the forcible conversion or assimilation of natives: it had been, like Holland’s, a commercial business, and it was abandoned when commercial logic dictated as much. Once India had gone, in 1947, there was little sense in trying to retain the rest in the face of local nationalists who, if given their way, would agree to keep the commercial ties going.