The Empire Project: The Rise and Fall of the British World-System, 1830–1970 (72 page)

Of course, none of this implied the repudiation of power. The Labour leadership had refused any truck with Gandhian agitation in 1920, and insisted in its first (minority) government in 1924 on strict adherence to the Montford constitution.
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The champions of trusteeship insisted that African self-government lay far in the future. The effect was more subtle. The liberal mood of the early 1920s inspired a more thoughtful defence of colonial rule and a more critical view of its actual practice. The ex-proconsul, Lord Lugard, whose sense of publicity was unusually sharp (his wife had been on the staff of
The Times
) urged a ‘dual mandate’ in tropical Africa. Economic development brought reciprocal benefits to Europeans and Africans. The task of government was to balance the interests of international trade and its indigenous subjects.
¹⁴⁵
Amid the new stress on enlightened trusteeship and non-interference with ‘primitive’ peoples, ‘indirect rule’ acquired additional merit. A neo-traditional regime based on customary law and chiefly rule became the settled dogma of African policy. In the new wave of paternalism, humanitarian causes, including education and anti-slavery, attracted fresh attention if not more resources. Extending self-government (however gradually) to the non-white colonies meant that cultural sympathy across racial lines had become more urgent. In E. M. Forster's
A Passage to India
(1924), the stilted parochialism of ‘Anglo-India’ and its cold rejection of educated Indians was held up to ridicule and proclaimed as a warning.

The strongest emotion in this age of flux was the fear of commitments and the urge to save. This was hard to square with the leftover business of the First World War. The political turbulence of the post-war years arose from this conflict. The Lloyd George government faced a huge agenda: in Europe, at home, and in Ireland as well as in the imperial sphere in India, Egypt and the Middle East. On almost every issue it faced fierce dissent, some of the bitterest from its backbench supporters in the House of Commons. Over Ireland particularly, Lloyd George's readiness to negotiate with Sinn Fein (from July 1921) enraged the ‘die-hards’ in the Conservative party. Signs of compromise in the treatment of ‘extremists’ in India and Egypt (like the failure to arrest Gandhi) strengthened die-hard claims of the ‘empire in danger’. It was Lloyd George's misfortune that some of the credit he gained from the Irish treaty in December 1921 was devalued by the civil war between the Irish ‘treatyites’ and ‘anti-treatyites’. But the real cause of his downfall in October 1922 was the lack of economic recovery at home and the sense of over-commitment abroad. Working-class discontent over unemployment and pay was matched by middle-class anger at the high rate of taxation (income tax had risen to five shillings (25 per cent) in the pound in 1917, and was at six shillings (30 per cent) throughout 1919–22). Government ‘waste’ became the target of a public campaign and had to be appeased by a formal enquiry (the ‘Geddes axe’). The military cost of British control in Iraq (partly perhaps because Winston Churchill, a coalition Liberal, was the minister responsible) drew especially bitter complaint from the Conservative backbenches, on whose support the coalition cabinet was overwhelmingly dependent. It was the lightning rod for unease over a Middle East policy whose aims seemed obscure and whose outcome uncertain. When the British force at Chanak in the Dardanelles faced the Turkish army advancing north from Izmir in September 1922, and military conflict seemed likely, two streams of discontent were united. Whatever the merits of its case – the strategic argument for preventing the Turks from recovering the Straits – the coalition government had risked a new war in the Middle East for which public opinion was quite unprepared.
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When Bonar Law (who had favoured coalition in 1918 and been Lloyd George's loyal lieutenant until 1921) came out of retirement to lead the Conservative revolt against continued partnership with the Lloyd George Liberals, he could draw on multiple sources of Tory resentment. But it was the over-extension of British power that he chose to emphasise. Britain, he said in a famous phrase, ‘cannot alone act as the policeman of the world’.
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The fall of Lloyd George opened two more years of party manoeuvre, induced in the main by economic uncertainty. The Conservative ministry of Bonar Law (until May 1923) and Baldwin was dominated by the setback to European recovery, by the need to cut spending and by the fear that Lloyd George would build a new coalition against its economic failure. Baldwin's sudden leap to protection was intended to offer a definite programme and unite his party round the cause to which much of it was already loyal. It was an electoral disaster. In December 1923, the Conservative vote held up well (at 38.1 per cent compared with 38.2 per cent in November 1922), but Baldwin was swept away by the Free Trade opposition. But the result was inconclusive. A minority Labour government took power with Liberal support in January 1924. Neither circumstance, inclination, nor, perhaps, talent, could make Ramsay MacDonald a second Gladstone.
¹⁴⁸
No great centre-left party emerged in a grand realignment of political forces. When MacDonald was pulled down by the petty scandal of the ‘Campbell case’, and by public suspicion of his party's communist ties (the Zinoviev letter), it was Baldwinite Conservatism that won the high ground electorally. In October 1924, it gained a decisive victory. With the long-awaited revival of European prosperity, and the return in Britain of a ‘social peace’,
¹⁴⁹
the domestic instability of the post-war years seemed a thing of the past.

Yet it had left its mark on the British role in their imperial system. Baldwin's aim was a broad-based party that would annex the centre in British politics. He renounced protection and installed a free trade Chancellor (Winston Churchill). He embraced ‘economy’ in defence, partly to fund the rising cost of welfare expenditure. He had learnt from Chanak to fear confrontation abroad as a hostage to fortune. He and other leading Conservatives accepted much of the ‘liberal’ outlook on international affairs, as a rough approximation to informed opinion and as a useful guide to the post-war world. As a result, the imperial attitudes of the post-war years seem curiously tepid. At another time, high unemployment, a vast new electorate and the nationalist revolts against imperial rule might have prompted the embrace of a jingo populism. Indeed, tariff reform at home, ‘splendid isolation’ abroad, opening up the ‘undeveloped estates’, and a firm way with ‘agitators’, all had their advocates in Conservative ranks. But the overwhelming need was to bind the new political nation to an economic order (capitalism) it had no reason to like. An attack on free trade (as Baldwin discovered) would be deeply resented by the new constituency. Pre-war-style thinking on imperial defence – as if Britain were still surrounded by rival world empires – was (or seemed) obsolete at a time when the reconciliation of Europe was the most immediate need and competing imperialisms at an unusually low ebb. Coercive tactics against colonial (or semi-colonial) dissidents in the Empire, Egypt, Iraq or China could not be ruled out. But their likely cost, and the fear that they would lead to political extremism and guerrilla war (the ‘Irish syndrome’ frequently invoked after 1921) gave an added premium to emollient policies. To a much greater extent than before 1914, the demands of empire on society at home were to be monitored closely and reduced to the minimum. What sort of empire that made in the age of depression the following chapter will try to explain.

10 HOLDING THE CENTRE, 1927–1937

Until the mid-1920s, it had seemed as if the profound dislocation of economic and political life unleashed by the war would defeat all attempts to devise a new equilibrium. After 1925, the outlook improved. A new economic order took shape in Europe, underwritten by the flow of American investment. Franco-German reconciliation lifted the threat of a new European struggle. The impetus behind anti-colonial nationalism slackened off. The world economy recovered the vigour of its pre-war decade. The volume of trade surpassed the levels of 1913. As the age of extremes receded, liberalism and ‘moderation’ seemed in the ascendant. But it proved a false dawn. In October 1929, the Wall Street ‘crash’ signalled the return of economic uncertainty, followed soon after by the huge fall in commodity prices, the sharp contraction of trade, deep rural impoverishment and mass unemployment. The crisis of capitalism became the crisis of liberalism. The survival of nations and their internal stability demanded illiberal solutions: protection, autarky, or aggressive imperialism (to those with the means); a retreat to the land, exiguous self-sufficiency, or desperate rural rebellion to those without power. In culture, as in trade, free exchange was devalued in so hostile a climate. Utopianism, despair and nostalgia were its more typical products.

This massive upheaval in global conditions held huge implications for the British world-system. In the late 1920s, its liberal apologists had talked of a ‘third British Empire’, based not on rule but on the growth of cooperation and partnership in a world-spanning ‘Commonwealth’.
¹
Less liberal politicians looked forward to a period of political calm in which ‘nationalist’ demands in India, the dominions and elsewhere would be soothed by the concession of greater autonomy, and disarmed by the knowledge that secession or exit from the imperial embrace was self-defeating at best. The geopolitical scene was benign. The risks of devolution declined and the costs of defence fell as the threat of armed conflict receded. Despite the heavy burden of war debt, the great revival of trade promised the gradual return of Britain's old role as the merchant, shipper, insurer and banker to much of the world, and the entrepot of its commerce. Britain remained the one great free trading power, just as it had been before 1914. Even British migration (now almost entirely to Empire destinations) picked up to the levels of the 1890s, if not to the great rush of 1900–14.
²
But all this was the prelude to a great reversal of fortune.

From 1929 onwards, the British system was caught up in the world's economic and geopolitical earthquake. Almost all the conditions on which its wealth and safety depended now looked much more uncertain. The threat of a great power assault on British interests or territory, a remote possibility before 1930, became increasingly real and imperial defence a more arduous task. The contraction of world trade, the ever-higher walls of protection, and the renewed war between currencies, wrecked the hopes of British exporters and shrank the ‘invisible income’ which made up the deficit on the balance of trade. Britain's wealth and prosperity, the core of its power, seemed to be dwindling away. As economic catastrophe loomed over much of the world, the virus of nationalism (as opinion in Britain was inclined to see it) spread wider and deeper. It infected the great powers on whose mutual restraint the British system relied – if the costs of defence were to be kept within bounds. It encouraged the attack on foreign property and trade which the British (with more of both to lose than anyone else) had good reason to dread. Nationalist ideology corroded the ‘steel frame’ of colonial rule, challenged its systems of political influence and drove it willy-nilly into costly coercion. As geopolitics, economics and nationalism converged, Britain's loose-knit empire, far-flung, ill-defended and so reliant on trade, looked like a hostage to fate. Secure in its ‘Antonine Age’ only twenty years earlier, by the mid-1930s the British system seemed plunged (to some observers at least) in a terminal crisis. ‘The storm clouds are gathering’, Churchill told the Conservative party in December 1934, ‘others are ready and waiting to take our place in the world.’
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There were plenty of those who for partisan reasons foretold the early demise of British world power. Expectant Marxists, frustrated nationalists and embittered imperialists all wrote its obituary. Even sympathetic observers, peering in from outside, were deeply alarmed. ‘England is beset by manifold dangers’, wrote the German jurist, Herman Kantorowicz, in a book first published (in German) in November 1929. ‘The economic foundation of her greatness grows narrower from day to day.’
⁴
The Americans were richer, the Germans better trained, even the Russians more numerous. Britain's industries were outdated, its workforce overpaid, the recourse to tariffs a delusion. In the age of the aeroplane, it was no longer an island, and was too small geographically to be an effective air power. The British were also the main object of Muslim and Asian resentment, and the ‘colonial epoch’ was on its last legs. ‘In this age of nationalism, it will be impossible to hold India’; Iraq and Egypt were already slipping the leash. Deprived of its empire, Britain would decline ‘into a second Holland’. Much of Kantorowicz's warning was echoed by André Siegfried, a French political scientist of unrivalled prestige. In
England's Crisis
(1931), he emphasised industrial obsolescence, an unsustainable standard of living and the falling away of British foreign investment as the seeds of economic decline. The British depended upon international trade: they had no choice in the matter. Protection would do them no good. But economic nationalism posed a deadly threat. ‘Caught between a “Fordised” America and a “cartelised” Europe, [Britain] will eventually have to enter an international economic alliance.’
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It was not strong enough to preserve a worldwide influence and ‘stand alone as before’.

For much of the decade after 1929, British leaders struggled to contain the effects of geopolitical change, economic depression and nationalist politics. For much of the time, they saw themselves as confronting the centrifugal forces that were pulling their system apart. Their aim, so far as consistent purpose can be seen, was to hold the centre: against the threat of strategic defeat, economic implosion or social upheaval. They wanted Britain to remain, so far as it could, at the centre of world trade. They were determined to keep it in its central position in its own world-system, by hook or by crook. They were also anxious to soften the social conflict at home that high unemployment might bring. But there was a limit to what they could achieve on their own. In the self-governing dominions, preserving the ‘British connection’ in more straitened conditions required the support of local political leaders acutely aware of their own public opinion. In India it was caught up in the four-cornered struggle between the Raj's ‘steel frame’ of British officials, the Congress politicians, the Muslims and the princes. London's survival as a centre of world trade would turn on how well it adapted to the new global economy of blocs, tariffs and barter. But what mattered most was beyond British control. The fate of their system, British leaders were beginning to learn by the late 1930s, might really depend on the unsated ambitions of the ‘have-not’ powers – Germany, Italy and Japan – and their inscrutable leaders.