Darwin J. The Empire Project. The Rise and Fall of the British World-System, 1830-1970

Подождите немного. Документ загружается.

505 / The strategic abyss, 1937–1942

Smuts’ popularity,

was undisturbed by the presence of an alternative

great-power patron in the Southern African sub-continent. But there

were warning signs that the greater warmth that Smuts had brought

to the imperial link would only be temporary. Afrikaner nationalism,

frustrated in parliament, mobilised furiously among teachers and jour-

nalists and denounced Smuts’ government as a British lackey. The 1943

election was a formal triumph, but a closer analysis was less reassuring.

The percentage of Afrikaners who voted for the United party fell from

40 per cent in 1938 to 32 per cent,

while the nationalist opposition

was united ﬁrmly behind D. F. Malan and an independent republic out-

side the Empire.

The dream of fusion and Afrikaner reconciliation to

the British system was fading away.

The second pillar of British world power was the Indian Raj.

India had been the captive market for Britain’s largest export, an impor-

tant ﬁeld for British investment and a vital contributor to Britain’s bal-

ance of payments – though all three had suffered badly in the 1930s.

But its greatest value after 1900 had been as the indispensable auxiliary

to Britain’s military power. The Indian budget had paid for two-thirds

of the Empire’s standing army. Its vast rural manpower formed an

inexhaustible reserve against an imperial emergency. At the outbreak

of war, however, India’s military strength was in decline. The Indian

army was unmechanised. Funds were short. The modernisation pro-

gramme, for which London was paying, had hardly begun. Nor was it

expected that Indian troops would play an important part in the Euro-

pean war. The main objective of the Army in India (a term used for the

combined British garrison and the Indian army proper) was to defend

the Northwest Frontier against Afghanistan. The Nazi–Soviet pact of

August 1939 made it seem all the more important to keep watch on the

Central Asian front against the ‘old enemy’.

As a result, although the Viceroy would have liked to enlist

Congress support and keep their ministries in ofﬁce, there was no sense

of urgency on the British side. After May 1940, the picture changed

dramatically. Over the next six months, the Indian army was almost

doubled in size. In the following two years, the total strength of its

combat arms rose to over two million.

Recruitment, supply and the

promotion of war industries became the central preoccupation of the

Indian government. The cooperation of Indians (especially the edu-

cated) became more and more vital, and the wooing of opinion all the

more necessary. Not surprisingly, then, the Viceroy, Lord Linlithgow,

506 / ‘The great liner is sinking’

made another attempt to draw representatives of the Congress into the

government. The ‘August Offer’ promised dominion status at the end

of the war (no deadline had been offered previously), Congress seats in

the Viceroy’s ‘cabinet’, and an advisory council to bring a larger Indian

voice into the war effort.

The Congress refused. Dominion status,

said Jawaharlal Nehru, was ‘as dead as a doornail’. India must be free

to leave the Empire–Commonwealth.

The widening rift between the British and Congress was not

just the result of nationalist mistrust of British intentions, or the paci-

ﬁst inclinations of the large Gandhian wing. The real reason was the

tacit but deepening commitment of the British to the claims advanced

by the Muslim League. Since the Lahore resolution of March 1940,its

leader Jinnah had insisted on a Muslim veto – in effect a League veto –

on any constitutional settlement hammered out for India. An inde-

pendent India must acknowledge ‘Pakistan’ – the whole community

of Indian Muslims – as an equal partner in a confederal India.

The

League would negotiate an equal footing with the Congress. Of course,

successive Viceroys had long recognised the Muslim claim to separate

representation, to protection against a ‘Hindu Raj’, and to the right

to govern the Muslim majority provinces. The grand federal scheme

of 1935 had been designed to prevent the concentration of power in

Congress hands by devolving heavily to semi-autonomous provinces.

But, from 1940 onwards, the politics of war gave a ﬁerce twist to this

established policy. The most vital zones of the Indian war effort were

Muslim majority provinces: Bengal, which contained more than half of

India’s industrial capacity; and the Punjab, the main recruiting ground

of the Indian army. In both, Muslim-dominated governments had co-

operated willingly.

But their goodwill and stability could not be taken

for granted – especially if talk of constitutional change raised the tem-

perature of Hindu–Muslim rivalry. Nor would recruitment continue

if communal tensions discouraged would-be sepoys from leaving their

homes.

The result politically was that, at the very moment when it

was more important than ever to gain the cooperation of Congress,

the British had less than ever (of what really mattered) to give away

in return. The stalemate persisted until the end of 1941 and the early

phase of the Paciﬁc War. Then the rapid advance of the Japanese armies

showed that India would soon be in the war’s front-line and that its

war effort would need to be cranked up to even higher levels. This

507 / The strategic abyss, 1937–1942

was not the only worry. The dismal failure of Malaya’s defence raised

a disturbing question. What would happen if India were attacked or

invaded? Would the internal administration fall apart as Indians refused

to take orders or abandoned their posts? Would the Indian masses sim-

ply disown a colonial regime in which the largest party had no share

of power? The prospect unnerved the government in London. The case

for a new approach was strengthened by signs that the Congress ‘mod-

erates’ might be more amenable, and even more perhaps by Churchill’s

grudging acceptance that some new initiative was needed to disarm

American complaints against colonial rule.

Congress endorsement of

the British war effort (then at its nadir) would be helpful evidence of

the continued vitality of the British system. What was needed, urged

Clement Attlee, in a burst of hyperbole, was someone who would

save the British Empire in the East as Lord Durham had once saved

Canada.

Singapore fell thirteen days later.

The fruit of this rethink at the war’s worst moment was to be

a new constitutional offer. As soon as the war ended, India’s politi-

cal future would be handed over to a ‘constitution-making body’, free

to withdraw India from Empire membership and the British system.

Meanwhile, Indian participation in the Viceroy’s government would

be increased signiﬁcantly. It would even include a defence minister

with control over almost everything except operational matters. At

the Viceroy’s insistence (he threatened to resign), the offer was not

published. Instead, it was taken to India (and published there) by

Sir Stafford Cripps, widely considered Churchill’s likeliest successor.

Cripps began with high hopes that his old friendships in Congress would

win him a deal. But two insoluble differences wrecked his prospects.

The ﬁrst (and less serious) was the Congress insistence on a direct

say in defence operations – a demand to which London, the Viceroy

and Cripps himself were unanimously opposed. The second (and more

fundamental) was the British insistence that, whatever the model of

independence proposed after the war, the Muslim provinces and the

princely states would be free to opt out and make their own arrange-

ments in negotiation with Britain. It would be up to the Congress to ﬁnd

an acceptable formula. This was the recipe for ‘Pakistan’ or – worse still

‘balkanisation’ – that the Congress feared most and rejected completely.

With an imperial war effort ever more deeply dependent upon Muslim

goodwill, it was also the recipe that London could not surrender. By

early April, all negotiation was over (Congress gave its ﬁnal rejection

508 / ‘The great liner is sinking’

on 10 April), and Cripps was on his way home.

Two months later,

as the Japanese armies drove closer towards the Indian frontier, the

Congress passed its ‘Quit India’ resolution, and set in motion a mass

campaign to bring British rule to an immediate end.

The failure to agree with Congress did not prevent the British

from using Indian resources and manpower to ﬁght the rest of their

imperial war. Nor did Quit India prevent the successful defence of the

Indian frontier in the desperate battles of Imphal and Kohima. Never-

theless, the Cripps offer and its violent aftermath signalled the deﬁnite

end of India’s special place in the British system: the sentence of death

was merely postponed. It was true, of course, that the federal scheme

on which the British set such store had stalled politically before the

war. It was also true that any further advance towards dominion status

would have meant a progressive reduction in India’s military contri-

bution to imperial defence. The British garrison, for which India paid,

would have had to go home. On the other hand, it was more than

likely that, with the power to shape its successor regime (without a

deadline, a ‘constitution-making body’, or a prior commitment that

India could secede from the British system), the Viceroy’s government

would have secured special status for the Indian army, largely ofﬁcered

by British expatriates, and tied India closely (through a treaty or bases)

into the global system of imperial defence. But for the Paciﬁc War, India

would still have been a ﬁnancial debtor, a dependent part of London’s

sterling empire. But, in its desperate scramble for a constitutional settle-

ment amid the political fall-out of the Singapore surrender, Churchill’s

Cabinet was forced to play almost all its trumps. Abdicating control

over the constitutional process, let alone the timing of the constitutional

convention, was a last-ditch effort to soothe away Congress outrage at

the Muslim veto. Cripps’ ultimate failure and the violent unrest of Quit

India that followed left the Raj a political bankrupt. It could repress

disorder and gaol the Congress leadership (Nehru went to gaol for the

rest of the war

). But it had no means of containing the rising tide

of communal tension, and nothing left to trade with India’s political

leaders. The promise to go had been published abroad. In two revolu-

tionary years, the British had ‘sold off’ what remained of their Indian

empire to meet the pressing demands of their last imperial crisis.

The third blow was perhaps the hardest: the collapse of

London’s commercial empire, the ultimate guarantee, alongside sea-

power and the Home Islands’ resources, of Britain’s global status. By

509 / The strategic abyss, 1937–1942

the outbreak of war, that commercial empire was very different from

what it had been in 1913. Then London had been the undisputed centre

of a global trading system, and sterling the indispensable medium for

international transactions. British investment, like British trade, was as

much international as imperial: nearly half was placed in Latin Amer-

ica or the United States. The huge stream of income from Britain’s

‘invisible exports’ was reinvested abroad to build up still further the

enormous claim on overseas resources. The First World War had cut

this empire down to size. Its dollar assets were sold to buy munitions in

the United States (by 1929, claimed The Economist, only 3 per cent of

British investment was in the US

). A huge debt was contracted. And

heavy borrowing at home reduced the capital available to lend over-

seas. After 1931, when Britain went off gold and adopted protection,

the commercial empire had become more and more a sterling empire.

Following the Ottawa agreements of 1932, the British Empire countries

with Argentina (and some other non-empire states) formed a trading

bloc. With the exception of Canada, they also acted as a currency bloc,

the sterling area. By the late 1930s, a large proportion of British trade

was conducted within the sterling area and the post-war tendency to

concentrate British investment in empire countries became even more

marked – reaching 62 percentofthetotalattheendof1936.

As the

effects of depression bit deeper, Britain’s portfolio of overseas assets

slowly shrank. The marked shift towards investment at home, and a

much less favourable balance of payments after 1930, made it hard to

replenish the capital fund at the rate that was needed to maintain its

value. Nevertheless, in a world divided into economic zones, London’s

commercial empire was second to none. London was still the banker to

the largest group of trading countries. It had preserved the core of its old

ﬁnancial business, and its overseas clients (including the dominions and

India) were among the soundest. Britain’s overseas trade was as large as

that of the United States – despite the huge disparity in national output.

The invisible earnings from this great commercial network still paid for

a quarter of her merchandise imports and supplied 5 per cent of the

national income.

The Achilles’ heel of the British system was its need for dollars.

Before the war this was a manageable problem: protection and sterling

area cooperation had cut the demand for American goods. Predictions

of America’s commercial primacy had been decidedly premature. In

fact, America’s record of economic recovery from depression had been

510 / ‘The great liner is sinking’

much worse than Britain’s. Nor was it obvious that there could be

any escape to a permanent level of greater prosperity. The American

economy had been badly squeezed by the general collapse of agricul-

tural prices, affecting up to one-third of its workforce. To prop them

up and defend manufacturing against outside competition meant heavy

protection and a growing burden of internal debt. As imports shriv-

elled, American exports also suffered – from retaliation abroad and

the lack of dollars in foreign hands. There was no ‘dollar empire’ of

complementary producers to soak up the surplus of American indus-

try. American resentment at economic misfortune was partly aimed at

London’s sterling empire, and at what were seen as Britain’s persis-

tent attempts to devalue sterling against the dollar.

Although the late

1930s had seen somewhat better relations (the Anglo-American trade

agreement of 1938 had made limited concessions to American exports),

there could be little doubt that breaking up (or into) London’s commer-

cial empire was the most obvious way of expanding America’s trade in

a deeply segmented international economy.

Until 1940, there was little chance that they could do so. Cham-

berlain had been very protective of the sterling empire and part of the

rationale of his slow-motion war had been to reduce to the minimum

the ﬁnancial strain of additional dollar purchases. Britain’s dollar assets

were carefully husbanded and London built up a large stockpile of gold,

buying the entire production of South Africa’s mines in return for ster-

ling. But, after June 1940, this cautious strategy was blown to pieces.

In the desperate rush to re-equip Britain’s armies for a war of survival,

every marketable asset was pressed into service. Paying cash on the

nail, the British purchasing mission bought all the American supplies

they could ﬁnd. By December 1940, more than half of Britain’s pre-

war stock of dollars and gold had been spent

and the haemorrhage

was such that the rest would have been spent by March 1941.Inthe

event, the threat of bankruptcy, default and economic defeat was lifted

by lend–lease. Even so, by September 1941, gold and dollar assets had

shrunk even further to $1,527 million (approximately £340 million),

out of which pre-lend–lease contracts and non-lend–lease items had

still to be met, a total of more than $1 billion.

Nor, of course, was

lend–lease a gift without strings.

Roosevelt’s eagerness to help Britain rearm was entirely gen-

uine, and entirely self-interested. From his economic advisers, and the

business interests represented in Congress, British pleas for ﬁnancial aid

511 / The strategic abyss, 1937–1942

drew a calculated response. They were determined not to ease London’s

shortfall in dollars and gold only to ﬁnd that, when the war had ended,

they were back where they started, facing a sterling empire. They were

deeply suspicious that the British were hiding their fabled wealth. They

demanded a visible sacriﬁce of British-owned enterprises in the United

States.

And they made three stipulations in return for lend–lease.

British reserves were to be run down to the lowest possible level (a

demand later eased); British exports, especially to dollar markets, were

to be pegged back sharply – to less than one-third of pre-war levels;

and, at the end of the war, the British would have to agree to aban-

don any trade discrimination against American exports. The sterling

empire would be blasted open. Its industrial engine-room and ﬁnan-

cial power-house would be drastically weakened. In unspeciﬁed ways,

it would have to make good the largesse of lend–lease.

Its member

states would look elsewhere. To J. M. Keynes, the ‘Churchill’ of the

economic war, the negotiation with America was a gruelling struggle

for what was left of Britain’s commercial independence.

This doomsday scenario was not entirely realised – for reasons

to be explained in the following chapter. But there was little doubt

that between 1940 and 1942 the pre-war balance of commercial power

between London and Washington shifted for good and erased in the

process Britain’s century-old status as a (and, for much of the time, the)

dominant force in the world’s trading economy. This was not just a

matter of exhausting Britain’s assets in dollars and gold. In the sterling

empire, too, the dramatic change in the scope of the war piled up new

obligations overseas. ‘The growth of balances in favour of other parts

of the sterling area is becoming unmanageable’, remarked Keynes in

June 1942. ‘The more the war moves to the East, the more we spend in

the Middle East and India.’

By September 1942, Britain already owed

India some £360 million for goods and services supplied to the war

effort, wiping out the whole of India’s pre-war debt to Britain. A year

later, the ﬁgure was £655 million. Egypt was owed some £250 million.

It would mean, said Keynes, ‘great prospective embarrassment’.

What

Keynes had in mind was obvious enough. The large sterling balances

(i.e. the amounts Britain would have to pay sterling area countries at the

end of the war) would mean much larger exports than before the war,

to meet overseas debts and compensate for the loss of invisible income.

Without the cushion of invisibles, it would be a constant struggle to

avoid a deﬁcit on the balance of payments. There would be no surplus

512 / ‘The great liner is sinking’

to rebuild Britain’s overseas investment, and the attractions of sterling

as an international currency (a highly proﬁtable status) would soon

disappear. The vicious circle would close. Across the Atlantic, the new

economic order had already been glimpsed. The Pax Britannica was

dead, announced Fortune magazine in May 1942. Britain was ‘broke,

her empire shrivelled . . . her banking and insurance income will never

come back and her merchant marine is sinking’.

‘Since the Pax Bri-

tannica can no longer be counted on to defend America, what kind of

world-power system does America propose to put in its place?’

The fall of Singapore

Churchill had convinced himself, and sought to convince others, that

Japan would not dare enter the war until Britain was defeated or dis-

abled. Under the terrible strain of the invasion threat, the Atlantic strug-

gle and the see-saw war in the Mediterranean and North Africa, it was

hardly surprising that neither he nor his Chiefs of Staff found much time

to ponder the risks of defeat if Japan attacked Singapore and Malaya.

Even after Pearl Harbor, Churchill fell back on the comforting mantra

that Singapore could hold out in a six-month siege.

Local army opin-

ion took refuge in racial contempt for Japanese military prowess: the

Japanese might beat Chinese armies; Europeans would be different. But,

when the Japanese army invaded northern Malaya, its battle-hardened

veterans were more than a match for its British, Indian and Australian

defenders, many of them recently recruited, poorly trained or barely

acclimatised. The catastrophic loss of Prince of Wales and Repulse,

poor intelligence and the lack of air power combined with poor gener-

alship to turn Singapore from an ‘impregnable fortress’ into the ‘naked

island’. Once the British forces had abandoned the mainland and ﬂed

onto Singapore island, their fate was sealed. On 15 February 1942,

130,000 British Empire troops surrendered to a numerically inferior

attacking force.

The symbolic importance of such a shameful failure was bound

to be large. In The Times despatch from nearby Batavia (modern

Jakarta), the obvious lesson was drawn. ‘“Soft” troops, unenterprising

commanders, an apathetic native population – these are not the signs

of a gallant army betrayed only by bad luck; they sound uncomfortably

like the dissolution of an empire.’

In his private diary, Churchill’s

513 / The strategic abyss, 1937–1942

most senior military adviser expressed a similar foreboding. ‘We are

paying very heavily now for failing to face the insurance premiums

necessary for security of an Empire! This has usually been the main

cause for the loss of Empires in the past.’

As defeat sank in at home,

there were loud demands for a new approach to colonial rule, and a

‘colonial charter’ to win the hearts and minds of Britain’s subject mil-

lions. Fresh impetus was given (as we saw earlier) to the search for an

Indian settlement. A propaganda campaign was launched to make the

imperial case in the United States, before opinion there hardened into

an angry contempt for Britain’s dysfunctional empire. But the meaning

of Singapore was not just symbolic.

Singapore’s fall was the brutal proof that the Eurasian Rev-

olution of the 1930sand1940s had reached its climax. The global

preconditions in which a British world-system had been continuously

viable since the 1830sand1840s had all but disappeared in the storms

of war. The European balance, precariously restored after 1918,had

been comprehensively wrecked: indeed, German domination of Russia

seemed more than likely in the early summer of 1942. ‘Passive’ East Asia

had become an uncontrollable vortex of anti-Western imperialism. In

this colossal emergency, the British system lacked the means to defend

itself unaided and had not the faintest hope of restoring the status quo

ante. The internal structure of Britain’s pre-war system, as well as its

ethos and assumptions, had been drastically destabilised by a geopo-

litical earthquake: the relentless consequence of Anglo-French strategic

defeat in 1938–40. How much would survive in a modiﬁed form, were

the Allies to emerge victorious, was, in 1942, anyone’s guess.

THE PRICE OF SURVIVAL, 1943–1951

Amid the calamities that crashed over them in 1942, it was hardly

surprising that British leaders, including Churchill, should have thought

mainly in terms of survival. In the course of that year, they faced the

prospect of defeat in the Middle East and the loss of Egypt and the

Canal, a disaster which would have meant far greater losses than those

incurred at Singapore. Without their main ﬁghting force, their hope of

keeping control over India – let alone of exploiting its resources and

manpower – would have been fatally weakened. The Viceroy’s ability

to suppress the Quit India movement would not have been helped by

the sight of the Germans in Cairo. At much the same time, they could

only watch helplessly as the German advance into Russia threatened

the collapse of the Soviet regime. A huge reordering of Eurasia seemed

on the cards with the ‘world-island’ divided between the Nazi and

Japanese empires. Preserving a maritime ‘rimland’ without the Middle

East, India and Southeast Asia, and keeping Britain’s connection with

Australia and New Zealand, would have been all but impossible. The

British world-system would have been a funeral pyre.

Of course, it was true that America’s entry in December 1941

had brought massive relief and the assurance, perhaps, of survival in

some form. In June 1942, the battle of Midway destroyed Japan’s hopes

of naval control of the Western Paciﬁc. By the end of the year, victory at

Alamein and the grim Russian defence of Stalingrad seemed to promise

that the relentless expansion of Germany’s power had at last been con-

tained. But neither was remotely a guarantee of ultimate victory in

Europe, which depended on the Red Army and the Anglo-Americans

ﬁghting their way into the European ‘fortress’ heavily defended by the

Germans and their allies. The risk of defeat, or stalemate, was high,

especially in the case of an amphibious attack, the Anglo-American