Prof Scott Newton
The Sterling Devaluation of 1967, the International Economy and Post-War Social Democracy
For many years it was argued that the 1967 devaluation of sterling was forced on a reluctant Labour government and reflected the collapse of confidence in the foreign exchange markets concerning its ability to lift Britain’s balance of payments out of the red for more than a few months at a time. Recently historians have started to question this orthodoxy, and this article aims to take the revision a stage further. It suggests that sterling's difficulties in 1967 were not directly linked to the performance of the UK current account; that the devaluation was not forced, but the result of choice; that there was no last-ditch resistance to devaluation from the Government; and that the decision represented a continuing effort on the part of Labour to reconcile its domestic social-democratic project with membership of an open global economic system.
English Historical Review (2010) CXXV (515): 912-945.
The two sterling crises of 1964 and the decision not to devalue
Conventional wisdom is critical of the newly elected Labour government’s reaction to external financial difficulties in the autumn of 1964. Anxious about its political position, it avoided the necessary measures, involving stringent deflation and possibly devaluation. This article seeks to revise the traditional view by re-examining the response to what were actually two sterling crises. The first was handled efficiently. The second was provoked by speculation stemming from market expectations of devaluation. The decision not to devalue but seek external support was justifiable, given changes within the international economy which were to create problems for many postwar nation states.
Economic History Review 62:1 (2009) 73-98
Profits of Peace: the political economy of Anglo-German appeasement, Oxford University Press (1996)
An interpretation of appeasement which challenges orthodox and revisionist accounts by focusing on the economic motivation behind the policy rather than the workings of foreign policy. The author argues that appeasement stemmed from the determination of pre-world war two British administrations, particularly that of Neville Chamberlain, to protect the liberal-capitalist status quo established on the collapse of Lloyd George’s reconstruction programme after 1918. The search for an accommodation with Germany was aided and abetted by the Bank of England, the City of London and large-scale industry. It was maintained well beyond the outbreak of war, up until Churchill became Prime Minister in May 1940. Even after this certain circles within the establishment loyal to the pre-war order continued with their efforts to reach a settlement until the bizarre Hess affair, which signalled the appeasers’ last throw. The subsequent entry of the USSR and then the USA into the conflict guaranteed that there could be no separate Anglo-German deal, and combined with war socialism at home to open the door to a new era characterised by the welfare state and the Anglo-American special relationship.
Profits of Peace: the political economy of Anglo-German appeasement, Oxford University Press (1996), pp. viii + 217, ISBN 0-19-8320212-1
Scott Newton (2004) The Global Economy 1944-2000. London: Arnold.
Globalization – the development of a world without economic frontiers – has become an increasingly popular subject for economists, social scientists and political commentators. The conventional wisdom is that this new international economy is the natural outcome of market forces and cannot be resisted except at great cost to economic and social welfare.
The Global Economy 1944–2000 challenges this argument on three grounds. First, the national power of the USA has been manipulated since the 1940s to promote an open international economy. Second, multinational capital emerged as a key influence in support of the historic aims of US foreign economic policy. Third, there has been resistance to these pressures by socialist, social-democratic and by radical nationalist movements in the industrialized and developing worlds. It was not the market so much as the interplay between these influences that shaped the contemporary international economy.
The Global Economy 1944-2000. The Limits of Ideology. Arnold (London, 2004), pp. xvi+ 192
ISBN 0 340 76137 7(hb)
ISBN 0 340 76138 5 (pb)