David Kynaston's Till Time's Last Sand reveals how the Bank's relationship with government—from the gold standard to the Crash—have shaped the nation's economy since 1694by Robert Skidelsky / September 11, 2017 / Leave a comment
Published in October 2017 issue of Prospect Magazine
David Kynaston is a wonderful social historian, with three massive volumes on post-war Britain and many others to his name. He has been a leading practitioner of “history from below,” reflecting the experiences of ordinary people. He has now turned to telling the story of one of Britain’s most powerful and mysterious institutions—the Bank of England, from its founding in 1694 up to 2013.
He faced a number of challenges. Anyone writing an official history is bound to pull his punches. Though far from uncritical, Kynaston has succumbed somewhat to the Old Lady’s mystique. Then there is the question of audience. Kynaston was commissioned to write the book for “the general reader.” This is almost impossible because banking is highly specialised. Explaining all the technical terms would have slowed down the narrative, but not explaining them often leaves the general reader floundering. Kynaston is a masterly storyteller and has made the material as accessible as it could possibly be to the non-specialist. Still, a glossary of technical terms would have been helpful.
While the history of the Bank as an institution plays to the author’s strengths as a social historian, the task also demands an ability to relate institutional practice to debates in monetary theory, which Kynaston does not command. He compensates effectively by allowing bankers and finance ministers to explain in their own words what they thought they were doing. But what is missing is an independent judgment on the unfolding events. “There was much to ponder” is not enough.
These caveats apart, Kynaston has done a great job. Even the general reader can enjoy the 800-page ride, even if he or she is not left with an exact knowledge of how the engine works.
This is the story of how a consortium of merchants, formed to lend money to a cash-strapped state to pursue its foreign wars, came to dominate the monetary conditions of the kingdom. Its three conflicting obligations—to raise loans for the sovereign, defend the convertibility of its notes into gold (the Gold Standard), and maximise the profits of its shareholders—gave rise to continuous friction between the Bank and government, and the Bank and its competitor joint-stock banks. Such friction was seemingly resolved by the nationalisation of the Bank in 1946, when it became an instrument of government policy. However, after the inflationary 1970s, opinion swung back to the need for an independent institution to limit the government’s ability to print money.