What a lesson from history tells us about the dangers of simple remediesby Benedict Macon-Cooney / May 22, 2019 / Leave a comment
It is the turn of the century and an unease is gripping British politics. Led by a man described as a “fanatical charlatan,” the debate is dominated by trade and tariffs, creating splinter groups in parties and forcing the prime minister to respond with fudges to hold the governing party together. The question is one of Britain’s place in the world: how to react to the forces of globalisation, and how Britain’s economy can compete as powers around it rise.
The episode contains useful lessons for today. This period—played out in the early 20th century—had a long and profound impact on British politics and the direction the nation took. Decades of agitation by elements of the Conservative Party, led by Joseph Chamberlain, the political hero of Theresa May’s former joint chief of staff, Nick Timothy, culminated in the 1932 Ottawa Agreements. It was a victory for protectionists, who had sought a system of reciprocal tariffs and agreements between the dominions and colonies of the British Empire, as well as duties on imported goods including food and grain, for the best part of 50 years. The move was designed to fortify the market against other global actors and protect domestic workers.
As with Brexit, the simplicity of the idea was its primary selling point. Chamberlain specified that he preferred “a little common sense” to economics. The Daily Mail and the Daily Express were vociferous in their support with the latter declaring that “we are protectionists none the less. We stand for the protection of our own people.” But much like Brexit, imperial preference was a misguided attempt to react to a changing world. Its aim was to reinforce existing industry, rather than expand and modernise. Similarly, for all the talk of Global Britain, the insularity at the heart of most Brexiteer analysis betrays its pretence to internationalism. And far from being a remedy, both events came from delusions that have periodically revealed themselves again and again through the years.
Then, the world had been through its first great period of globalisation. Writing about this “extraordinary episode in the economic progress of man,” in The Economic Consequences of the Peace, John Maynard Keynes reflected that the “inhabitant of London could order by telephone, sipping his morning tea in bed, the various products of the whole earth… and reasonably expect their early delivery…