Britain Sixty Years Ago (IV): Global ties & ‘A little local difficulty’.   Leave a comment

Looking more broadly, in the mid-fifties Britain was still a world-wide player, connected and modern. Her major companies were global leaders in oil, tobacco, shipping and finance. The Empire was not quite gone, even though the new name of ‘Commonwealth’ was more widely used in official circles. Britain was not a country closed to foreign influence, whether from America or Italy or Scandinavia. Something first promoted as ‘Italian Welsh rarebit’, later known as ‘pizza’ was in evidence. The idea of a powerful, self-confident Britain, independent of American cultural influence, seemed not only possible but likely. Per capita, Britain was still the second richest country in the world.

However, after the Suez Crisis, Britain would no longer possess independent power or influence in the Middle East. The age of American power there, based on support for Israel and the oil alliance with the Saudi Royal Family, took the place of British hegemony. Suez also provoked the arrival of the Mini car, designed in the wake of the petrol price shock caused by the seizure of the canal. Macmillan replaced Eden as PM and decided to remain in the tiny nuclear club as a cheaper alternative to imperial swagger. He authorised the first British H-bomb explosion at Christmas Island in May 1957. It was partly a fake, a hybrid bomb intended to fool the US into thinking its ally was further ahead than it really was. The next year, at a crucial showdown between British and American scientists in Washington, the British Aldermaston team persuaded Edward Teller’s Los Alamos men that Britain was just as far advanced as the US in the field of nuclear weaponry.

The major international event of 1957 was the signing of the Treaty of Rome, the beginning of what we know today as the European Union.The continental negotiators were shocked and disappointed by Britain’s lack of serious interest, but the six founding members shrugged off Britain’s attitude. They were still rebuilding shattered cities and healing torn economies, and for them the coming of the ‘community’ was manifest destiny. Coming so soon after Suez it provoked increasingly agitated head-scratching in Whitehall.

For Britain, the world was still differently shaped. The Commonwealth was then more than a worthy outreach programme for the Royal Family. Its food and raw materials poured into Britain and there was an illusion that Britain’s manufacturing future would be secured by selling industrial goods to South Africa, New Zealand, Australia and Canada. Out would flow engines, cars, clothing, aircraft and electronics, in exchange for butter, oil, meat, aluminium, rubber, tobacco and wood-pulp. The poorer members of the sterling club kept their reserves in London, so Britain acted as banker as well as manufacturer for much of Africa and parts of Asia. Most people believed that to cut adrift the Commonwealth and join a new club would be economically ruinous as well as immoral. For Labour, Harold Wilson told the Commons that if there has to be a choice, we are not entitled to sell our friends and kinsmen down the river for a problematical and marginal advantage in selling washing machines to Dusseldorf. Later, Hugh Gaitskell told the Labour Conference that membership of the European Economic Community would mean an end to a thousand years of history:

How can one seriously suppose that if the mother country, the centre of the Commonwealth, is a province of Europe… it could continue to exist as the mother country of a series of independent nations?

At the same time, the European market, thirsting for new consumer goods, was growing spectacularly fast, while the Commonwealth trading group was by comparison falling behind. Most of the smaller countries did not want Britain anyway and the richer nations of the Commonwealth would soon turn to the United States for their consumer goods.

Yet membership of the EEC would subordinate Britain to the continent in other important ways. It was recognised from this earliest date that sovereignty and independence would be lost. Other forms of subordination and loss of independence had already happened, however. The foundation of the United Nations and the establishment of NATO had involved the relinquishing of traditional freedoms of action. Nevertheless, Europe was something different. Those who had looked clearly at the Treaty of Rome were struck by its overwhelming ambition. Lord Kilmuir, Macmillan’s Lord Chancellor, told him that Parliament would lose powers to the Council of Ministers whose majority vote could change British law; that the Crown’s power over treaties would partly shift to Brussels and that British courts would find themselves in part subordinate to the European Court of Justice. Macmillan himself tended to brush these concerns aside with reassuring words, trying to keep everyone happy, but Kilmuir was joined by Lord Home, the future  PM, in giving outspoken warnings.

Had Britain been involved in the European adventure from the start, as the French had initially wanted, the EEC and the EU might well have evolved differently. There would certainly have been less emphasis on agricultural protection and more on free trade. ‘Europe’ might have appeared to be a little less mystical and a little more open and democratic. Even after the shock and humiliation of Suez, the Commonwealth and Anglo-American relations still took precedence for London. Macmillan’s team, centred on Edward Heath, hoped that somehow the trading system of the Commonwealth supporting English-speaking farmers from across the world could be accommodated by the protectionist system in Europe. They seem to have thought that any loss of sovereignty would be tolerable if such a deal could be struck. Macmillan had nothing like the reverence for the House of Commons felt by Enoch Powell, on one side of that House, or by Hugh Gaitskell on the other. Meanwhile, Britain’s struggle to keep up in the nuclear race led to private Anglo- American negotiations which infuriated the French. After the Treaty of Rome took effect at the beginning of 1958, French attitudes hardened with the return of General de Gaulle as President, determined that the new continental system would be dominated by France and would exclude the Anglo-Saxons.

1957 was also the year in which some Tories first began to break with the Keynesian economics of the post-war consensus in favour of a return to their older doctrines of economic liberalism. Antony Fisher, a chicken-farmer and utterly self-certain individualist and anti-socialist, had made enough money to found the Institute of Economic Affairs, undoubtedly the most influential think-tank in modern British history. Set up by Fisher and the Liberal, Oliver Smedley, the IEA was intended to combat the socialist influence of the Fabians. It first began to influence British politics during the winter of 1957-8, when inflation was rising above 4% and wage settlements were in double figures. Macmillan was worried about the confrontation which might emerge from cut-backs and unemployment, and he had many spending ministers, taking care of the armed forces, hospitals and welfare who were strongly opposed to cutting back. On the other side of the argument were the Chancellor, Peter Thorneycroft, and his two junior Treasury ministers – Nigel Birch and Enoch Powell. They insisted that it was vital to control the money supply, a position advocated by the IEA. They put together a planned series of cuts which included a fifty per cent rise in the cost of school meals, freezes on pay rises and the removal of family allowances for the second child.  It would have hit five million families, including millions of middle-class mothers whose support the Tories needed. In the end, the Treasury team lost the battle in cabinet and all three resigned. Macmillan dismissed the whole matter as a little local difficulty. Yet it marked a turning point, away from the ideas of free marketeers and towards the last phase of the planning economy and, eventually, to Thatcherism. In the Thatcher Government, Lord Thorneycroft became Chairman of the Conservative Party.

Source:

Andrew Marr (2007), A History of Modern Britain. Basingstoke: Macmillan.

 

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