United Kingdom (of Great Britain and Northern
Ireland)
United Kingdom (of Great Britain and Northern Ireland) The UK has experienced the twentieth century as one of decline and fundamental transformation. At the beginning of the century, together with the USA it was the world's major power. Its British Empire reached dimensions unparalleled before or since. Alone among the European participants of World Wars I and II, it survived these existential conflicts not only victorious but also unoccupied. And yet, by the end of the century, its economy had declined to occupy a middling rank among Western industrialized nations, with its GDP per head below the average for the European Union. It had long ceased to be a world power, and retained sovereignty over only a few isolated small island colonies.
There are a number of reasons for this decline, some of them inevitable and outside British control, though their relative importance has been subject to intense debate. Among the inevitable reasons are that in 1900 the UK was still enjoying the fruits of its early industrialization, since by that time only itself, the USA, Belgium, and, arguably, Germany were fully industrialized. Its comparative economic lead was therefore bound to diminish as other countries caught up in their industrial development.
Furthermore, the international tensions of 1914 and the 1930s placed the UK in a critical situation. Its prosperity and its Empire were based on truly global trade. This was undermined by Germany's military, diplomatic, and economic aggression, which ultimately left the UK no option but to go to war. However, the government was never under any illusion that the wars would not be cripplingly expensive. The consequent massive government borrowing resulted in increased taxation, high interest rates, and currency instabilities, all of which were anathema to the principle of global free trade upon which the economy was based. In addition, increasing resistance made
de-colonization and the loss of the Empire inevitable, though in the end the country embraced this change with remarkable ease.
In addition to these structural changes, in other ways the decline of British power in general, and its economic performance in particular, was the result of domestic factors. Most importantly, there was a fundamental reluctance of British investment to finance innovations in domestic industry, as capital could be invested more profitably abroad. The discipline of science was relatively backward, particularly during the first half of the century in England (though not Scotland), and there was a marked tendency for the intellectual elite to pursue a career in banking or public administration, rather than commerce or industry.
In fact, the first signs that all was not well with the UK and its current relative levels of prosperity and power came during the South African (Boer) War (1899–1902), the length of which triggered Haldane's badly needed army reforms. The fact that vast numbers of city dwellers were unfit even to join the war gave rise to renewed concerns about the physical health and conditions of the poorer classes. This led to the success of Baden-Powell's Scout and Guide movements, and increased interest in social research conducted, for example, by Rowntree and the Fabian Society. Ultimately, it led to the acceptance of the need for some social reform, as advocated by Tawney, Hobson, and Hobhouse. Following the defeat of Balfour's Conservative Party over Joseph Chamberlain's campaign for tariff reform, the Liberal Party gained a majority in the 1906 elections under Campbell-Bannerman. It was not until his succession by Asquith (1908), with the inexhaustible Lloyd George as Chancellor of the Exchequer, that a serious
programe of social legislation was enacted. Old-age pensions and unemployment insurance were introduced. An unprecedented revolt by the House of Lords against the 1909 budget also led to a major
constitutional reform in 1911, when the veto of the Lords was no longer absolute, but restricted to two years (Parliament).
Participation in World War I proved a traumatic experience for the UK, which had declared war on Germany on behalf of the entire British Empire on 4 September 1914. Disastrous losses at the Somme and Paaschendaele under Haig, and at Gallipoli, led to rapid disillusionment and frustration. In 1916 Lloyd George replaced Asquith to provide more charismatic leadership. Ironically, even though the UK emerged from the war greatly weakened economically and financially, the British Empire reached its greatest dimensions, as former colonies of the German and Ottoman Empires were added as League of Nations Mandates. This extension of power was more superficial than real, as the Dominions of Australia, New Zealand, South Africa, Newfoundland, and Canada received ever-greater autonomy, culminating in the Statute of Westminster (1931), which gave them de facto independence. More crucially, in 1921 a compromise was found whereby southern Ireland received autonomy and Dominion status, while Northern Ireland was given Home Rule, but as an integral part of the UK.
To overcome the financial consequences of the war, British ministers pursued the policy of appeasement, hoping to escape another war through trying to avoid the arms race that had precipitated World War I. In domestic politics, the interwar period was marked by the decline of the Liberal Party and the gradual rise of the
Labor Party. As the progressive vote was weakened and split by this process of transition, politics became dominated by the Conservative Party. It had first drawn on Lloyd George's popularity at the Coupon Elections of 1918, and then formed a government on its own under Bonar Law.
Labor formed its first minority government under MacDonald in January 1924, but was replaced by Baldwin's Conservatives, 1924–9. The economy suffered under the misguided reintroduction of the Gold Standard in 1925, while the defeat of the General Strike in 1926 displayed the social and economic weakness of the
labor movement in British society, despite its growing political strength through the
Labor Party. The Arcos raid displayed the general volatility of the interwar period, though compared to its bigger European
neighbors (France, Italy, Spain, Germany), interwar Britain proved a beacon of stability. In 1929, MacDonald formed
Labor's second minority government.
Most of his ministers were reluctant to respond to the Great Depression in the way prescribed by the current economic orthodoxy. MacDonald formed a National Government that rested on the support of Conservatives, Liberals, and a few of his
Labor supporters, but it was opposed by the majority of his own Labor
Party. He was at the head of an increasingly Conservative-dominated national government until 1935. The Gold Standard was finally abandoned, as was free trade, when tariffs and Imperial Preference were adopted in the Ottawa Agreements of 1932. After a brief period of government under Baldwin (1935–7), Neville Chamberlain tried to avert another war through signing the Munich Agreement (1938), but was forced to declare war on Germany on 3 September 1939, after Hitler's invasion of Poland (World War II). After Germany's invasion of Norway in April 1940, the discredited Chamberlain was replaced by the ebullient Churchill.
Alarmed at the retreat at Dunkirk and the Battle of Britain, the British underwent a fundamental sea-change in social and political attitudes in the first years of the war. This was best expressed in the widely received Beveridge report of 1943, and found an outlet in the victory of the
Labor Party under Attlee in 1945 in the greatest recorded electoral swing in British politics. Aided by a diverse group of able ministers (Bevin, Bevan, Morrison, and others), the government nationalized industries such as mining, electricity, and the railways, and created a social welfare state, most notably through the foundation of the National Health Service. A state that would provide for its citizens ‘from the cradle to the grave’ became the accepted norm of government in the following decades, until 1979.
These changes were largely accepted by the Conservative governments, 1951–64, which were led successively by Churchill, Eden, Macmillan, and Douglas-Home. This period marked effectively the end of the British Empire through the
de-colonization of most of Africa, while the disastrous Suez Crisis of 1956 brought home the message that had been unavoidable since the fall of Singapore in 1942: Britain was no longer a world power, and was able to pursue her global interests only with the consent (and support) of the USA. A youthful Wilson led the
Labor Party to victory in 1964, and remained in power until 1970, but neither he nor his successor, Heath (1970–4), were able to deal with the burgeoning trade union movement, which stifled any attempt to deal with the economic problems of inflation and a balance-of-payments deficit. Wilson returned to power in 1974 and gave way to Callaghan in 1976, but neither found an effective response to worsening global economic conditions caused by the oil price shock of 1973.
Keynesian demand management was dismantled during this time, but it was the advent of Thatcher as Prime Minister (1979–90) and Thatcherism that radically changed the political battleground, away from the postwar consensus of demand management to a new focus on the market. With the
Labor Party in disarray under Foot's leadership and the breakaway of the Social Democratic Party, Thatcher became the longest-serving (and first woman) UK Prime Minister in the twentieth century. She reduced the power of the state through privatization and cuts in social services and made the reduction of inflation, rather than of unemployment, the primary economic target. This was unpopular at first, but the Falklands War restored her popularity and enabled her to win the 1983 election.
Ultimately, her resistance to European integration and her autocratic government style (as displayed by her insistence on the poll tax) led to her replacement by Major, who continued to pursue her basic policies, albeit in a rather more sober and
lackluster style. Major was weakened by a tiny parliamentary majority which made him beholden to the warring factions within his own parliamentary party. His most lasting achievement was the beginning of the Northern Ireland peace process. This gained him few votes in domestic politics, where his weak,
gray, and indecisive image contrasted with a dynamic, disciplined Labor
party led by Tony Blair.
Blair won the 1997 elections, and embarked upon an ambitious project of constitutional reform which saw the granting of Home Rule to Scotland and Wales from 1999. Under Gordon Brown, indirect taxes were raised and income tax was lowered slightly. The economic growth rekindled during the Major years continued, and contrasted sharply with the sluggish performance of other economies such as Germany or the US. In 2000–1 an outbreak of the infectious foot-and-mouth disease devastated large parts of the countryside, as almost four million animals were slaughtered. Although the government was criticized for not responding quickly enough, the general election, which occurred as the epidemic subsided, returned another huge
Labor majority (413 of 659 parliamentary seats). Facing increasing criticism at the near-collapse of the country's rail infrastructure in 2000, and the poor state of the National Health Service, Blair's new government embarked on a quest to improve public services without abandoning his pro-business policies.
Following the September 11 attacks, the UK became Europe's most committed supporter of George W. Bush's foreign policy. Britain was the only country to assist the US-led Iraq War with significant forces of its own. The divisions which this invasion caused within Europe increased pressure for a more coherent foreign policy within the EU. The UK was at the forefront of such aspirations, and this led to the adoption, at the 2003 Intergovernmental Conference, of the European Security Strategy. The UK was thus pursuing the difficult strategy of being both influential within the EU, and maintaining its ‘special relationship’ with the US. England; Wales; Scotland; Northern Ireland; Ireland (Republic of); Imperial Conferences
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