Greater Post-War British Economy

[MickCz]

And there it comes, the rationalisation for the clinging. Anyone with half a brain could see that Malaysia was going to become independent, as it indeed did in 1957. So how much profit did the UK make from that extra decade of ownership? Especially after deducting the costs of the Malayan Emergency, the Indonesian Confrontation, and all the other expenditures that basically related to defending the USAs newly acquired south-eastern empire from communism.

How much did the UK economy benefit from selling weapons to tinpot regimes compared to eg West Germany’s benefiting from selling VWs to the entire world? Basing not only your entire foreign policy but consequently your defence policy and armed forces structure around “but we need to keep the sheiks on board so we can sell them shiny toys” also seems rather counterproductive.

Again, after WW2 the UK was broke. It could not afford the costs of empire, especially since any remaining benefits of empire were effectively going to the US anyway. But instead of questioning every expenditure on the basis of “what direct benefit does this bring the UK” it seemed to fall by sheer force of habit into “this is what the imperial power does so we should do it” even though the imperial powers were now the US and USSR. Consequently IIRC UK defence spending was a higher % after WW2 than it was in 1913 during the “arms race” and most of UK Marshall Aid went on supporting the US in wars on the other side of the planet, at a time when the economy was desperately fragile and lacking in investment since before WW1. All money pulled out of the civilian economy and pissed away.
I mean, we have just had a big discussion in this thread on the impact of the Korean War. IMO the UK should have taken a policy decision that NATO was its sole comittment and sent only whatever token forces it could easily scrape up.

With respect, it's not my "rationalisation ", but that of those who were in charge of running the Empire and the UK. Personally, I'm pretty much with Barnett; most of the Empire should have been dumped pre 1939 or immediately post 1945. But all of that is with hindsight. The mindset of both the Conservatives and Labour was Imperial; they had come of age at the height of Empire and were trapped by it, as many are now trapped by the outdated concept of the EU.

But they did think globally. The concept of selling shiny toys to the sheiks was not just that. It was selling military assistance both materiel and expertise. It was to keep the oil flowing and free from Soviet influence; oil rich states are not "tinpot", as was emphasised during the Oil Crisis of the 70s. The West could not risk that being a weapon to be used by the USSR. Indeed the USA specifically asked the Saudis to let it have oil to continue fighting in Vietnam. However the UK could not provide the protection to the sheiks that the USA could, so the sheiks very wisely went with the USA. That allowed the creation of the Petro-dollar whereby oil can only be bought with dollars. That has underpinned the US dollar and therefore the US economy for decades; without it the USA would be much weaker.

With regard to the Korean War, the USA feared it was the organised prelude to a general aggressive war by the Communist bloc; the UK did not really believe that. However as the only two significant Western military powers extant and members of the Security Council who voted to assist South Korea, the USA and Britain could not then refuse to do so. Both re-armed to counter the supposed general threat, which was illusory as is now apparent.

As previously stated, the view of some historians is that it was the inflation in the price of raw materials, caused by the massive US rearmament, which derailed the UK economic revival. In other words, it was the indirect effect of Korea, not the direct effect.

Also, UK leaders were not necessarily ignorant of the problem of military commitments. Macmillan said of Germany "we are protecting them while they steal our markets....." But recognising a problem does not give the capability to solve it.

,

 

[Charles James Fox]

That might actually do more harm than good. I've seen it suggested that North Sea oil and gas made sterling be viewed as a petro-currency leading to it becoming largely overvalued, making it harder on exporters since their goods became more expensive. Now there were also other factors in the 1980s that didn't help like the policies taken against inflation but even without that it's going to be a problem. There's also the question of what you class as 'much earlier', and whether the technology is there to exploit it.

Agreed it was a double-edged sword, I think the Chair of the CBI said that the Government would have been better off 'leaving the bloody stuff in the ground.'

I agree with a lot of the points here around lack of investment in infrastructure, the decline of sterling, unsustainable imperial commitments, cultural aversion to industry etc. I've been reading into the 1970s again recently through The Times Archive: wage-push inflation caused by Britain's decentralised and dysfunctional trade union system was a serious handicap for Britain's economy, meaning that inflation remained high long after the oil shock and the government had very little room for manoeuvre in economic policy. It's difficult to easily imagine how to change this in the post-war period, perhaps Labour are out of office longer and then there's an earlier industrial crisis that encourages trade union reform, or Wilson and Heath don't seriously mess up efforts at reform.

 

[Thomas1195]

So long as the British are in a position to initiate various post-war infrastructure projects like the Greater London Plan (including the London Ringways plus precursors and other road projects, additional Airports at Cublington, Maplin Sands / Foulness and Willingale, limited-to-no Metropolitan Green Belt, UK Disneyland, the many unbuilt London projects and elsewhere, etc).

Together with improved modernized manufacturing / etc for post-war British industries to thrive (Cars, Motorcycles, Railways - Advanced Passenger Train / APT, etc), an earlier British analogue of France's Messmer Plan and greater British success in sports particularly the World Cup / UEFA (beyond 1966).

It would be worth having the above in favor of the British giving up the delusions of Empire compared to the current Declinism of the UK since post-WW2 (if not prior) up to the present.

National trunk roads and even something similar to Greater London Plan could have been built during the Great Depression. Such plans were part of 1928 Liberal Manifesto/Yellow Book.

 

[Masked Grizzly]

National trunk roads and even something similar to Greater London Plan could have been built during the Great Depression. Such plans were part of 1928 Liberal Manifesto/Yellow Book.

Are those plans related to subsequent road and rail, etc proposals during the 1930s?

 

[Thomas1195]

Are those plans related to subsequent road and rail, etc proposals during the 1930s?

I am not sure, I don't really have much materials. The Liberal plan was in "We can conquer unemployment", and the focus was more on motorways rather than railways, given the fact that British motor industry was growing fast at that time. Lloyd George essentially wanted to build a British Autobahn. But an election pamphlet couldn't be even more detailed, especially in 1928.
There are also plans for electrification and telephone development.

One thing for sure is that austerity would have ended had DLG won.

 

[iron]

Oil has always been a real problem in society, yes it does bring in large sums of money but its pricing goes up and down. When its up countries tend to increase spending and when the price drops the citizens refuse to drop their living standards.

have a read here.

https://en.wikipedia.org/wiki/Resource_curse

As someone who's been living in the Province of Alberta since 1977?
Let's just say that you're "preaching to the choir"...LOL!
Boom/bust/boom/bust/boom/bust...rinse and repeat.
Take a look at the current drama going on (in this regard) around these parts.
If anything, it's taught me to run a tight ship as a businessman. Profit excessively when practicable, but never loose focus on servicing your bread and butter clients. This is the only way to keep your core people working when things (inevitably) go back in the toilet...as they currently are.
Been there, done that, got the T-shirt(s).

 

[Masked Grizzly]

I am not sure, I don't really have much materials. The Liberal plan was in "We can conquer unemployment", and the focus was more on motorways rather than railways, given the fact that British motor industry was growing fast at that time. Lloyd George essentially wanted to build a British Autobahn. But an election pamphlet couldn't be even more detailed, especially in 1928.
There are also plans for electrification and telephone development.

One thing for sure is that austerity would have ended had DLG won.

Managed to find the following links on roads:
- https://www.roads.org.uk/ringways/early-plans
- http://pathetic.org.uk/unbuilt/a-ring/
- https://www.sabre-roads.org.uk/maps/ - Click London Area for pre-war proposals, one of which seems to be a tunnel or bridge where the Woolwich Ferry crossing currently is in 1937 inner proposal.

As for pre-war rail plans in 1930s it seems the only plans one can find so far are the Northern Heights plan (which could have conceivably reached Watford from Bushey Heath) and plans for the Waterloo & City line to not only feature a new stop at Blackfriars, but also an extension from Bank to Liverpool Street and Shoreditch (onto the East London Line - albeit would probably be more practical for Waterloo & City line to initially terminate at Shoreditch and expand to 5 cars as opposed to linking up with East London Line).

What would help even more is Britain performing better during the Second Industrial Revolution (including a rail tunnel linking Euston to Charing Cross - following a similar route to OTL Northern Line branch, with an ATL Northern Line branch instead linking Euston to Waterloo via Russel Square, Holborn and Aldwych / Temple), along with minimizing the losses of both world wars and fighting more efficiently as well as investing in new equipment, ideas, etc during the interwar period (to the point of being able to push the Japanese out of Malaysia in 1941, furthering lowering Britain's end of war debt by 15-20%).

Not sure how David Lloyd George winning the 1929 General Election would help the UK towards such a goal if WW2 still happens on schedule, though quite like the idea of Rab Butler managing to become PM during the 1950s succeeding Churchill and being in a position to successfully implement Operation ROBOT.

Speaking of Rab Butler, it would have been interesting seeing him establish a new post-war Butler Act that reformed the Microcar class from classist 3-wheelers (initially without reverse gears) to more practical sub-Mini Kei Car style 3/4-wheelers (of similar dimensions to the 1950s Fiat 500) that other post-war British companies could potentially diversify into building.

 

[Masked Grizzly]

Another potentially interesting British analogue of the Volkswagen Beetle, would be Chrysler somehow establishing an earlier pre-war UK division producing a more feasible version of the FWD Chrysler Star Cars with either Flat-Four / Flat-Twin, 3-cylinder two-stroke or Inline-4 engines. - https://www.hemmings.com/blog/2007/07/29/sia-flashback-mopars-star-cars/

As for fixing the British Motorcycle Industry, the best way would be for manufacturers to build lightweight/small bikes (e.g. Honda Super Cub, Vespa and Lambretta plus other Scooters / Underbones / Mopeds, etc - catering for women as well as working class motorcycle riders) and avoid segment retreat amongst many other things (including being more willing to appropriate bikes / technology etc from the Germans in the aftermath of WW2) as mentioned in Steve Koerner's book The Strange Death of the British Motorcycle Industry.

 

[Masked Grizzly]

Going back to the idea of David Lloyd George winning the 1929 General Election, what role could he have actually played in helping the British perform better in WW2 and the post-war period given his OTL Pro-German stance and defeatism to potentially collaborationist views during WW2 that prompted Winston Churchill to compare him to Philippe Pétain?

 

[Thomas1195]

How about some PODs for changes in corporate governance. The OTL shareholder value focus in Britain led to two types of managers/directors: bean counters (like Lord Weinstock) or corporate raiders (like Lord Hanson), neither of them were good for long-term sustainable development of British industry.

 

[Thomas1195]

Going back to the idea of David Lloyd George winning the 1929 General Election, what role could he have actually played in helping the British perform better in WW2 and the post-war period given his OTL Pro-German stance and defeatism to potentially collaborationist views during WW2 that prompted Winston Churchill to compare him to Philippe Pétain?

At the minimum:
By strengthening British economy and infrastructures, which should help the rearmament process (most important).
By supporting Republican Spain.
DLG could be pro-Germany, but his party was not.

 

[Masked Grizzly]

At the minimum:
By strengthening British economy and infrastructures, which should help the rearmament process (most important).
By supporting Republican Spain.
DLG could be pro-Germany, but his party was not.

Would it have been possible for David Lloyd George to realise his plan in a single 4 year term to strengthen British economy and infrastructures, only to be narrowly defeated by Stanley Baldwin in 1933 (instead of 1935) or DLG wins in 1933 only for elections to happen in 1935 (or is quickly replaced by an anti-German leader of the Liberal party via a party revolt to prevent his pro-German sentiments from marginalizing the party)?

Perhaps his success in the 1929 elections within a 4 year term would translate to a significantly better showing by the Liberals against both Churchill and Attlee in 1945 and onwards in the post-war era?

 

[Cryhavoc101]

National trunk roads and even something similar to Greater London Plan could have been built during the Great Depression. Such plans were part of 1928 Liberal Manifesto/Yellow Book.

The late 20s and 30s is when changes need to be made - as you imply by 1950 it's too late

It does not matter how good British goods were (?) if an equally good or better item could be built elsewhere for less due to a cheaper and hungrier workforce and using newly built factories, ship yards etc - which was increasingly the case beyond the 50s

Union militancy and striking issues were going on before WW1 - it was not a new issue for the UK

One of my go to 'fixes' is for HMG of the day in the late 20s / early 30s to run a 'buy back' scheme on older freighters and tankers etc while at the same time coupling this with incentives for ship yards to modernise

The issue with modernising ship building in the late 20s and early 30s was that there was little incentive to do so

WW1 had flooded the world with what were effectively 'tramp steamers' many of which were still effectively very young - and other than their relatively smaller size and low speed there was nothing really wrong with them.

So HMG gives incentives to struggling ship yards to modernise

One of the issues with this is that the length of the slipways could not be increased and the associated factory buildings enlarged etc due to the encroachment of rail, road and housing as well as other infrastructure (water/sewers, Gas tanks, power supply etc)

The trick to this was to 'turn' the slip ways by say 45 degrees or so - reducing the number of them but making them longer - freeing up room for newer modern buildings etc at the same time

The expectation is that the ship yards will build more modern Freighters and tankers - that are both larger and faster than the legacy ships of the worlds merchant fleet

In addition HMG sponsors apprenticeship schemes for skills like wielding and electrical systems for school leavers and what have you

The final part of this is the 'buy back' scheme

If a given Merchant company buys a modern ship from a modernised British ship yard then HMG will buy their older ship at a favorable price

HMG either scraps the ship or if it were deemed suitable placed into a reserve merchant fleet

The advantages of this is that it takes these older ships from circulation (ie not passed on to 'lesser' merchant fleets which could undercut the competition defeating the entire objective) - allowing those Merchant fleets with more modern, faster, larger and more efficient vessels

Now obviously this jump starting of the ship building industries is unlikely under a conservative government who like to 'let the horse lead' with the idea that Industry knows better than Government - so it's probably going to require a Liberal Government during this period - and this is going to require one that is more allied with the growing 'Labour' movement or have the Labour party have less impact.

Ultimately though Britains heavy industries are going to be undercut by those cheaper and hungrier workforce that are using newly built factories, ship yards etc in those emerging nations - it is the way of things. What Britain has to do is 'reinvent' itself and focus on the areas of industry that those emerging nations cannot compete in.

The missed opportunities are obviously computing and Jets for example but that is another thread

As for DLG am not a fan of that odious poison dwarf - but I grudgingly concede that a UK lead by him during this time would probably be an improvement over OTL.

As for machine tooling etc - do what Stalin did - invite Albert Kahn or one of his proteges to the UK and sponsor him to advise British industry on the construction of modern factories which includes a large number of modern machine tools used in a 'single use' method (ie making one thing and not being continually re-calibrated for a different part during the life time of given production run)

Perhaps have HMG do the same thing with Machine tools as I have suggested for Shipbuilding - sponsor British machine tool manufacturers to modernise with an incentive for British industry to buy this newer tooling?

 

[Dunois]

For Britain to defy these trends requires them to at minimum start borrowing some pages from the French post-war playbook (though the French still lost most of these industries, they have succeeded in building a few successful national champions) without any Thatcher-types gaining power. But keep in mind, the French were acting as they did because they'd received a painful object lesson in how close they were to not being a great power any more in WW2. Britain had received no such blows.

One way to provide a "shock" to the system could be for the US not to provide loans to the UK post-war.
This will precipitate a big crisis and force some difficult decisions to be made.

 

[fasquardon]

Ultimately though Britains heavy industries are going to be undercut by those cheaper and hungrier workforce that are using newly built factories, ship yards etc in those emerging nations - it is the way of things. What Britain has to do is 'reinvent' itself and focus on the areas of industry that those emerging nations cannot compete in.

Britain had an especial problem in that much of her exports were in raw materials, semi finished materials and fairly simple goods.

At the turn of the century, ferrous metal production in Britain had more emphasis on iron than steel relative to Germany and as I remember the biggest single ferrous metal export by value was pots, pans and cutlery. Germany by contrast devoted a larger share of its production to specialist steels and I think their most valuable ferrous metal export was tools (maybe even machine tools). So as Britain's mines declined, and other countries gained industries of their own, British goods were low on the tree and quickly displaced.

Much of this, of course, is simply because Britain industrialized first and because of the iron ores and coals she was endowed with.

Britain must not simply move up the value chain, she has to also change her supply chains and also the relative weighting of different industries. More simple industries unfortunately employ rather alot of people in 20th Century Britain though, which makes shifting priority away from them politically more complicated.

One way to provide a "shock" to the system could be for the US not to provide loans to the UK post-war.
This will precipitate a big crisis and force some difficult decisions to be made.

I agree. I wonder if that means no Marshall aid for Europe either? I have a hard time seeing the US not supporting the UK economy sufficiently to tide things over in any scenario where they'd also be willing to involve themselves deeply in Western Europe.

One of the PoDs I think would be interesting (though it's much earlier) is Britain losing WW1. That could have very interesting political and economic effects on Britain, and facing a German continental hegemony would certainly motivate serious economic and political reform.

fasquardon

 

[Komnenos002]

If Britain was able to emulate France and retain several world class national industries, which ones are they likely to be?

 

[lurker]

If the United Kingdom had over time averaged growth .05% higher annually on average from 1945 to today, it'd be 44% larger today. .075% higher annual on average growth would mean a British economy that's 72.5% larger today. 1% higher annual growth on average would mean an economy twice as large.

Bit of a nitpick. I think you meant to write 0.5% (half a percent) and 0.75% higher annual growth respectively. 0.05% higher growth would result in an economy 4.4% bigger than today.

 

[Thomas1195]

Britain had an especial problem in that much of her exports were in raw materials, semi finished materials and fairly simple goods.

More accurately, simple and low-tech manufactured products (e.g. steam vs diesel locomotives). My old thread about comparing British and German industries did have information about this.

Britain must not simply move up the value chain, she has to also change her supply chains and also the relative weighting of different industries. More simple industries unfortunately employ rather alot of people in 20th Century Britain though, which makes shifting priority away from them politically more complicated

Worsened by powerful, hostile trade unions that essentially pocketed the Labour Party. These unions often blocked new technology and processes (e.g. welding). Any reforms related to industrial relation must be done during the 1920s-1930s.

Also, interwar austerity did not help, worsened the unemployment situation especially in the Industrial North. Austerity also resulted in lack of investments and improvements both in infrastructures such as roads (affecting car industry), electric power generation, telephone (Britain lagged behind nearly every single Western city in telephone lololol), and in military industrial capacity.

Pro-City policies such as pre-war gold standard also further damaged export industries.

Finally, Imperial Preference and the dependence on Imperial export markets, together with late entry into European markets, prolonged the lack of competitiveness of British industries in the long run by restricting competition. Perhaps joining ECSC in 1956 may help, or even have Britain initiating its own version of ECSC/EEC that probably taking into account Canada.

I agree. I wonder if that means no Marshall aid for Europe either? I have a hard time seeing the US not supporting the UK economy sufficiently to tide things over in any scenario where they'd also be willing to involve themselves deeply in Western Europe

Or even loans with actually tough Greek-style conditions, in this case, it could be no nationalization, investment over welfare.

 

[Masked Grizzly]

Curiously it seems Leonard Lord under Austin did manage to modernize, acquire new tooling and place his company in an advantageous position compared to OTL though it could be argued he could have gone much further by acquiring / expanding American Austin (thereby allowing the latter to have the production capacity necessary to build the original Jeep - albeit mated to an early version of the 2.2-litre "D-Series" engine that later appeared in the post-war Austin 16 hp) as well as establishing factories in Brazil, Mexico and India. The latter was actually considered by Lord in OTL, both pre/post-WW2 though in case of latter events such as the Royal Indian Navy mutiny, political instability and concerns the left-leaning Nehru would nationalize British interests dissuaded Lord from building a factory in India.

William Morris meanwhile was apparently influenced into being very parsimonious with his Nuffield Group company via the example of Andre Citroen, in which development of the Traction Avant / etc and expansion led to the company's bankruptcy and takeover by Michelin. However picking Miles Thomas to succeed him (allowing Thomas to implement his own modernization programme) whilst orchestrating merger together Leonard Lord behind Miles Thomas back to form BMC, which have not only placed Morris in an equally strong position relative to Austin but also made this ATL BMC a much stronger company overall compared to OTL. A dispelling of William Morris's old fashioned notions (Morris cars being side-valve only, etc) and sabotage of his own company (particularly the hindering of the Morris Minor, etc), would have allowed Morris to go much further in tandem with rationalizing down their engines to three (Wolseley OHV, Nuffield 4/6-cylinder aka early C-Series and XP OHV) and capitalizing on MG's post-war success by following the example of Jaguar and Triumph of gradually moving it upmarket to become a sporty luxury marque (that would carry over into the ATL BMC) in place of Wolseley and Riley (if Morris even bother's acquiring the latter).

Singer Motors would have definitely benefited in this scenario and probably maintained its position as the 3rd largest UK carmaker (and perhaps acquired Riley Motors instead of Morris or over the likes of Rover and BMW). Especially if they avoid the bad publicity surrounding the 1935 Ards TT disaster (part of a short-lived and ambitious yet partially successful motorsport programme) that partly led to Singer’s OTL decline, along with its factories being heavily bombed during WW2 which prevented Singer from regaining its previous pre-war position as a dominant carmaker. Where by the time Singer returned to building cars after WW2, its decline, loss of UK market share and resultant limited resources forced them to effectively re-introduce models based on pre-war design and technology at a period when rivals were introducing more advanced technology and design than Singer could provide at the time.

The UK faring better in the depression would have also probably helped the Daimler Company / BSA Group via an earlier successful BSA Ten / Lanchester Ten / Daimler Fifteen, in combination with the BSA Group acquiring Scott Motorcycles prior to WW2 and later building a version of the DKW F9 prototype as war reparations (via a prototype seized by the British after WW2). Sure it is dependent on them having better management, though they did succeed with the DKW RT125 based BSA Bantam motorcycle gained/developed under similar circumstances and allowing a UK analogue of Audi (e.g. BSA) / Mercedes-Benz (e.g. Daimler) to unfold akin to when DKW / Auto Union (later Audi) was owned by Mercedes-Benz.

Such an environment could have also allowed Jowett Cars to acquire a viable Boxer-powered version of the FWD Chrysler Star Car prototype (with Chrysler themselves possibly acquiring a stake in Jowett), prior to being acquired by Chrysler in the early-1950s saving it from closure (in place of the latter later acquiring the Rootes Group).


Going back to my question in a previous post, how much could David Lloyd George accomplish within a (single) 4 year or even (one and a half) 6-year term had he became Prime Minister in 1929? Would it have been enough time for him to strengthen the British economy and infrastructures, thereby allowing the British to perform better in WW2?

 

[Pesterfield]

Macmillan said of Germany "we are protecting them while they steal our markets....."

Think longer term with war reparations, require all German companies in the British zone to give x% of stock to Britain?

German success is then British success.