3Globalism and Imperialism: the Global Context of British Power, 1830-1960

John Darwin

I

How do we account for the course of British expansion in Asia, Africa and the Middle East in the 'imperial century' between 1815 and 1923 and for the long contraction that followed? For nearly fifty years the high ground in this debate has been occupied by two great schools and the stage army of their critics and camp followers.

In this chapter, it is this agreement on fundamentals that is the start­ing point for speculation.

Such an inquiry risks undignified collapse into the mere recital of endless variables or the reductio ad absurdum of a monocausal theory. Global history is not easily rendered into usable fragments. In this paper it is argued that we can best approach the problem by invoking two 'terrible simplifications'. The first proposes that as an open global system, the British empire was acutely sensitive to the pressures and prospects of the international economy. Three 'long swings' - the approach (1830s-70s), formation (1880s-1920s), and crisis (1930s-40s) of the world economy - form the chronological matrix for its rise and fall. The second that the world-wide span of British imperialism, its loose, decentralized organization, its frequent reliance on 'informal' methods, and the limited means of coercion available to it, made it especially vulnerable to political change wherever strong states contested its claims.

II

After 1830 the British steadily transformed a straggling mercantile empire into a world-system. While their success owed much to a parti­cular set of endowments and aptitudes, these in turn could hardly have come into play without favourable global conditions and the growth of new patterns of intercontinental trade and contact. It was once assumed that the 'spontaneous combustion' of home-grown industrial change had driven Britain's rise to global power. It is now plausibly suggested that it was the rapid intensification of commercial and cultural contact between European and Asian economies in the eighteenth century - expressed in the European demand for Indian textiles and Chinese tea, silks and porcelain - that was a crucial stimulus to British indus- trialization.¹⁰ Britain was particularly receptive to Asian imports: its growing 'consumer culture' reflected the strong attraction to 'exotic' products. Early industrialisation in textiles and ceramics mimicked the artisan manufactures of India and China. The profits to be made from tea were the hidden spring of treasure in the East India Company and served indirectly to drive forward its frontier of rule in South Asia. But it was access to the North American market that was the pacemaker of British foreign trade.¹¹

Thus well before the great age of Victorian expansion the British had been able to turn the Atlantic expansion of Europe and the commercial dynamism of Asian producers to their advantage.

The 1830s opened a new phase in the Euro-Atlantic economy and in Europe's relations with East Asia. European penetration of other large regions in the extra-European world reached a critical stage. The 'Eurasian revolution' that had begun with the European conquest of Bengal in the 1750s was reaching a climax. By 1830, the 'neo-Europe' in North America was undergoing a 'commercial revolution'.¹² With the land rush in Mississippi the 'cotton kingdom' had been staked out.¹³ The era of railway-building was under way.¹⁴ The inflow of European (mainly British) migration accelerated dramatically.¹⁵ The American economy was being integrated much more fully than before into the economy of Greater Europe: as market, supplier and demographic over­flow.¹⁶ With East Asia the volume of trade was much smaller. But there, too, the outcome of the political and commercial crisis of the 1830s was the (limited) integration of maritime China into the European trading system.¹⁷ In the Middle East, the political and strategic catastrophe that threatened the overthrow of the Ottoman Empire had as its by-product the wedging open of Egypt and the Ottoman provinces to European trade. Even further afield, the 1830s were the crucial decade in the for­ward movement of the European pastoral frontier in Australia¹⁸ and, perhaps, in the fraught relations between aborigines and white men.¹⁹ In New Zealand, the dangers of unregulated contact between European sailors, traders and escapees and Maori communities had been recog­nized in the appointment of a British consul in 1833 and led by a wind­ing path to annexation and the treaty of Waitangi seven years later.²⁰ In Southern Africa a double revolution was in progress.

These events among others were symptomatic of a vast disturbance in the relations between Europe and almost every region of the extra­European world: perhaps the climacteric to a long period of ever-closer cultural, commercial and physical contact - the product of mutual attraction.²² As the leading commercial state in the eighteenth century, Britain had promoted these contacts and, in turn, been shaped by them. But by 1830, she was, of all the European countries, much the best placed to take advantage of them and much the most exposed to their unpredictable consequences. This had less to do with the visions of policymakers than with the sociocultural formation of early Victorian Britain. Here the most obvious feature was an exceptionally dynamic commercial culture: the availability and cheapness of credit; the dense network of commercial intelligence; the sophistication of mercantile expertise; the appetite for exotic produce; and the supercharging of Britain's entrepot function by industrialized production. This commercial dynamism was closely linked to demographic instability. British and Irish labour was the most geographically mobile of any large European society and among the first to feel the effects of agricultural modernization.²³ With ready access to commercial shipping (and, perhaps, credit) it was no surprise that settlers from the British Isles formed the vanguard of European migrants in search of free land overseas.²⁴ Britain also boasted a markedly secular intellectual culture, sympathetic to scientific and geo­graphical enquiry and to their commercial applications.²⁵ The creation of the Royal Geographical Society in 1830 marked a new purposeful­ness in 'intellectual colonization'.²⁶ Finally, and not perhaps coinci­dentally, early Victorian Britain also experienced intense religious anxiety, much of it channelled into missionary and humanitarian enterprise overseas: anti-slavery may have been the strongest public emotion of the Victorian age.

This cocktail of social energies was the fuel for the diversified, plural­istic expansion signified by the 'imperialism of free trade'. As Gallagher and Robinson indicated, Victorian governments intervened periodically at the behest of private interests²⁷ eager to exploit the main chance for trade, settlement or conversion. But we should not assume that the mid­Victorians possessed the means for universal dominion, formal or infor­mal. The 'new order' of the 1830s was a pattern of constraints as well as opportunities. Britain might have gained more than other European states from the growing intimacy of intercontinental relations. But she had not been freed from the perpetual insecurity of European politics and the need to guard against domination or invasion by a continental league or a 'Napoleonic' superstate. Strategic vulnerability in Europe magnified the dangers of European competition elsewhere in the world. Fortunately for the British, neither France nor Russia, their principal rivals in an age of triangular imperialism, had the means or the will to shadow them everywhere. Even so, the conflict of interests was real enough. The British did not often enjoy a free hand: not in the Middle East;²⁸ not in East Asia;²⁹ not even in the South Atlantic.³⁰ Nor could they ignore the awkward corollary of American expansion: the impulses of 'manifest destiny' in Oregon, Maine and Central America. These had to be managed with extreme prudence, partly for fear of a transatlantic combination at Britain's expense.³¹

Nor was this the whole story. After 1830, many non-European soci­eties had bent, but not broken. Eurasian states from China to Egypt retained significant autonomy and the ability to limit European intru­sion, sometimes by playing off the interlopers against each other. It was not yet clear that they had lost the race to modernize and 'self­strengthen'. In many places, European intervention was necessarily cir­cumspect. Even where Europeans appeared as conquerors, occupiers or settlers, for much of the period between 1830 and 1870 their predom­inance was contested or equivocal. This was true in New Zealand, where Maori resistance persisted into the 1870s and perhaps beyond;³² in Southern Africa, the scene of innumerable 'frontier wars' lasting into the 1890s; and even in India, where the Mutiny left a durable legacy of unease. To one influential traveller in the 1870s, Turkish primacy in Western Africa seemed more likely than European.³³ There was no mid­Victorian 'global hegemony'. In reality, Britain's main spheres of influ­ence skirted those of numerous strong or resilient states in Europe, Asia, the Americas and sub-Saharan Africa. The resort to 'informal empire' was in deference to local muscle as well as to imperial convenience. The achievement of a real international economy of integrated regions and open markets was in prospect but not in hand. The export of capital was modest. In the meantime, Britain's place in the new ensemble of global interests was bound to be uncertain as long as Europe's future in Afro- Asia was unsettled. Not even Palmerston favoured ubiquitous self-asser­tion.³⁴ His critics, including both Peelites and Cobdenites, railed against the dangers of aggression, isolation and over-commitment, in the Near East as well as in China.³⁵ Perhaps they hankered after a British Sonderweg: a new kind of world power based on the Concert in Europe and a pacific dominion of trade, settlement and religion beyond. If so, the new shape of world politics after 1870 was as disappointing to them as to any disciple of Palmerstonian braggadocio.

III

It is still a commonplace in histories of British imperialism (despite the efforts of Cain and Hopkins) that the late nineteenth century was a time of trial. The competitors closed in. The stakes were raised. The costs went up. Much useless property had to be bought. Good money was thrown after bad. But for all the effort to prop it up, Britain's world position grew inexorably weaker and the outposts of empire more vulnerable. The grand extensions to the old imperial fabric in tropical Africa, Southeast Asia and the Pacific were a dangerous illusion. The high noon of empire was really an age of hubris.

It is easy to reach this conclusion if we draw our evidence from the usual witnesses: the dispatches of diplomats, the speeches of politicians or the warnings of pundits. But if we take a more panoptic view of the global conditions under which British imperialism was bound to operate, the picture seems much less clear-cut. It was certainly true that the shape of 'geo-economics'³⁶ and geopolitics had been sharply modi­fied. The economic interdependence of regions and markets reached a critical stage creating for the first time a 'world economy',³⁷ one of whose hallmarks was a global market in basic foodstuffs.³⁸ The univer­sal triumph of the commercial economy was widely expected. The scale of migration increased: from Europe, but also from India, China and even Japan. New zones of settlement sprang up: in Siberia,³⁹ western Canada, Argentina, Brazil,⁴⁰ and Manchuria.⁴¹ As temperate lands 'filled up', writers, publicists and prophets turned their attention to 'the conquest of the tropics'.

Behind the advance of the 'world economy' were two powerful agents of 'globalization' - the gradual convergence of prices, incomes and consumption most visible in the Atlantic economy.⁴² The first was the efficiency gains made possible in transport and communications by the spread of railways, steam navigation and the telegraph, the vital transmitter of market prices around the world. Railways could lower the cost of freight by up to 80 per cent,⁴³ transform the potential of inland regions and reshape their economic (and political) geography with electrifying speed.⁴⁴ Railways made bulk exports viable on a grand scale. They opened new regions to intensive settlement. In the Americas and North Asia they were the funnel for mass immigration. But the precon­dition for this huge expansion of infrastructure, and the second great agent of globalization, was a massive rise of foreign investment, increas­ing in the British case alone by more than three times between 1880 and 1913.⁴⁵ The export of capital played a further vital role in the develop­ment of a world economy. It helped ease the shortage of foreign exchange, the barrier to trade between countries without complementary needs, and widen the scope of the multilateral payments system - the electrical circuit of the world economy.⁴⁶ Two critical changes, especially visible in the British case, enhanced the scale and impact of foreign cap­ital. After the 1870s returns on earlier investment overseas were large enough to supply new demands for funds abroad: now overseas capital could meet the needs of its own expansion.⁴⁷ Secondly, perhaps as a result, late Victorian London saw the florescence of a hyperactive finan­cial network, feverishly shifting capital and profits between far-flung locations in Afro-Asia and the Americas as opportunity or mania dictated.⁴⁸ Here, too, was an engine of economic change apparently capable of enforcing social and political transformation at breakneck speed - nowhere more so than in the new eldorado on the Rand.

Of course the larger scale of trade and investment and the closer inte­gration of economic regions was also due in part to the rapid growth of new industrial economies in Europe and North America. The British faced stiffer competition in manufactured exports. German capital, as well as French, now competed for loans in East Asia and the Middle East.⁴⁹ But these effects were magnified by the special trajectory of late- nineteenth-century economic globalism. Firstly, America's 'grain invasion' of Europe, still only partly industrialized, exposed the rural producers and landed classes of the Old World to social disaster. The reaction was a sharp turn towards tariff protection among the continental states.⁵⁰ Secondly, the new 'global' economy was superimposed on a world in which colonial rule was still widespread and where colonialism was regarded as a legitimate, if not always practical, means of promoting the national interest. It was hardly surprising that colonial expansion appeared attractive, especially in the depressed 1880s, as relief for the stresses of globalism. So for the British, who rejected tariffs, the new shape of the international economy was simultaneously hopeful and threatening. In the worst scenario, if they were excluded from foreign markets by tariffs or colonialism, and challenged in their own by more up-to-date competition, the outlook was commercial attrition.

Geopolitics moved in parallel. Before 1870, European politics were connected to those of the rest of Eurasia and the 'Outer World' mainly by the triangular rivalry of Russia, France and Britain. To this fact, coupled with the relatively limited scope of European rule outside Europe and the undeveloped state of overland communications, can be attributed much of the freedom of manoeuvre enjoyed by the three imperial powers in their colonial and semi-colonial spheres. Where the interests of all three collided, as in the Near East, no decisive advan­tage could be achieved except in the unlikely event of single-handed military triumph. But after 1871, this triangular system became quad­rangular, or even (if Italy is included) hexagonal. It was inevitable that powers in the European states-system should exploit where possible the extra-European weaknesses of their rivals. Henceforth this game would have more players. Germany, in particular, had a powerful incentive to use non-European issues to prop up its new-found role as the arbiter of European diplomacy. As economic competition outside Europe grew sharper and the fear of protectionism rose, European activity in the extra-European world was bound to invoke diplomatic intervention and great power reaction much more frequently than in earlier periods.

Left unmodified, this might have driven the tensions of European diplomacy to a dangerous level. The local struggles of European traders, settlers, missionaries, explorers and other interlopers were always prone to rouse vested interests at home and spark an explosion of 'public' sup­port. Even masters of Realpolitik like Bismarck or Lord Salisbury could find themselves jerked into forward movement by the shock this administered to their political systems.⁵¹ The prospect that great power governments would be dragged willynilly into imperial wars by the machinations of colonial buccaneers and their disreputable backers excited and appalled contemporary opinion. In reality, the threat of unbridled imperial antagonism was reduced by the conservatism of all the great European powers; the reluctance to jeopardize their domestic arrangements by a foreign war; and above all by the shrewd calculation that the risks of a European armageddon could hardly be justified by imperial gain. Even under hexagonal imperialism, competitive coexist­ence remained the rule. Of course, there was always the chance that a grand European coalition would be formed against a power deemed guilty of excessive aggrandisement, and impose the principle of equit­able compensation embodied in the theory and occasional practice of the Concert of Europe. But in the 1890s, as the alliance system in Europe grew more rigid, coalitions against a single great power became less likely. The fear of being dragged into general war by the colonial adventures of an alliance partner exerted a further constraint on diplo­matic activism in the imperial sphere.⁵² Even after 1900 (when Lenin insisted that a redivision of the world was under way) there was little sign of a new partition, let alone one imposed by force. Britain, France, Germany and Russia settled their colonial differences by negotiation, however bad-tempered.

This was just as well. The political side-effects of an expanding inter­national economy and the increased capability of European states and private interests to project their influence into distant regions worsened the instability of many non-European societies. The Near East had long been a cockpit on Europe's doorstep. After the Eastern crisis of 1877-78, the problem of its eventual partition was a constant preoccupation of European chancelleries. But since no agreement could be reached on the peaceful share-out of its cadaver, the Ottoman Empire was condemned to be sick but forbidden to die. No single power, or even alliance, could face the retaliation that would follow unilateral seizure of the sultan's territorial assets. The price of this hiatus was an intense armed vigilance. After 1895 and the crushing demonstration of China's fragility inflicted by Japan, a second war of diplomatic position broke out. Pre-emptive occupation, compensatory occupation, concession-hunting, loan-con­tracting and consortium-building were its weapons. But, as in the Near East, no European power was strong enough to enforce its will or scoop the pool of Chinese trade.

The Ottoman and Ch'ing empires were the most dramatic examples of a wider phenomenon: the urgent need of many states in Afro-Asia and the Outer World to self-strengthen by administrative and technical modernization or succumb to a lethal combination of external pressure and internal discontent. The 'race against time'⁵³ into which some Afro- Asian societies had been forced before 1870 now seemed universal. The result was a fusillade of regional crises as polities in Africa, Southeast Asia and the Pacific tottered towards implosion. Volatile successor­regimes, European freebooters and hyperactive proconsuls waited in the wings, ready to impose solutions that took little account of great power relations or the constraints of grand strategy. The frontiers of competi­tion grew wider; the arithmetic of compensation more demanding; the protocols of bargaining more arcane. By the end of the 1890s it was a commonplace that the dual impact of economic and geopolitical change had turned the world into a closed system in which events on the remotest periphery reverberated at the centre of world politics in Europe.⁵⁴

As the European power that had built up the largest portfolio of colonial and semi-colonial interests before 1870, Britain was the most vulnerable to relative decline if hexagonal diplomacy, stiffening competition and geopolitical instability were to affect larger and larger areas where British influence (however superficial) had once ruled by default. For the British, however, the problem could not readily be solved by selecting the zones where commercial advantage or strategic necessity were greatest. As prime agents of economic globalization, British com­mercial interests had a growing stake in the opening of new markets. A loud domestic chorus was ready to protest against the losses to be expected from foreign occupation on the one hand or anarchy on the other. The weight of the 'overseas sector' in commercial, financial, reli­gious and scientific enterprise was greater than in earlier periods, and its influence more easily exerted through publicity. That would have counted for less had not a second factor acted on British politics with the force of gravity. Unlike the larger continental powers, the British rejected tariffs as an antidote to the grain invasion of the later nineteenth cen­tury. They accepted the social consequences of greater exposure to the international economy.⁵⁵ Mainstream opinion acknowledged that autarky was not an option, and that Britain was bound to choose the open sea not the closed door. Heavier dependence upon foreign food­stuffs and overseas trade meant a deepening engagement with global politics and economics. It meant taking more seriously than ever the fact, emphasized by geographers, of Britain's centrality in a 'globe-wide world' unified by maritime traffic.⁵⁶ It meant accepting, in a world in which globalism and imperialism were yoked together, that the uneasy Victorian experiment in Afro-Asian despotism practised in India might have to be repeated in many lesser rajs.⁵⁷

Defending and expanding a free trade empire, formal and informal, against all comers was a nerve-wracking task against imperial competi­tors who enjoyed much easier access to the extra-European world than before 1870. There were moments when fear of isolation, catastrophic defeat or financial attrition induced something like near panic.⁵⁸ But over the period as a whole between 1880 and 1914, geopolitical conditions proved surprisingly benign. The caution and conservatism of European statesmen, and the unexpected resilience of the two main East Asian states were the vital context in which Lord Salisbury and his successors were able to mount a highly successful diplomatic campaign to defend and enlarge the mid-Victorian inheritance.

Salisbury held firm views about the likely course of world politics. Like most observers, he expected a small number of 'world states' to dominate the scene. He thought the independence of extra-European states would be undermined by 'pacific invasion'. He regarded Afro- Asian societies as poorly equipped for political survival or material progress, and dismissed most as 'dying nations'.⁵⁹ The real question was how the resulting instability could be prevented from damaging Britain's international position or sharpening tensions to the point of war. Salisbury adopted two methods to ward off these dangers. Where possible he favoured an agreed partition of territories and spheres to neutralize the trouble-making of sub-imperialists and their paymasters at home. Where necessary, he strove to maintain the regional balance by the flexible choice of diplomatic partners and limited, ad hoc, combinations against aggrandizing rivals - as in the Near East and East Asia.⁶⁰ The consolidation of Britain's position in Egypt (1898-1904) and South Africa (over which Russia, France and Germany considered and rejected an anti-British coalition)⁶¹ were the trophies of success. With so many established bridgeheads in the extra-European world, Salisbury was able to exploit, more than any continental statesman, the divisions of European politics: the watchful antagonism of the European powers; their fear of an upset in the continental balance; their aversion to a general war. After 1900, his proteges recovered their nerve and adapted his method to the new dimensions of Weltpolitik through an alliance withJapan and the colonial ententes with France and Russia. British world power might have suffered a relative decline since the days of Palmerston. But no other power proved strong enough to unravel the global partition (and its informal equivalents) from which the British had made such disproportionate gains. That was the lesson of Russia's military disaster in 1904-05, and of Germany's diplomatic defeat at Algeciras (1906) and over Agadir (1911). British leaders had reason to conclude that it would take the overthrow of the European states system, with all its checks and balances, to demolish the geostrategic defences they had so laboriously constructed.⁶²

Edwardian Britain was thus a successful (though not carefree) adapta­tion to the strenuous conditions of globalism after 1880. In economics as well as politics, there were opportunities to exploit as well as competitors to fear. By remaining a free-trade state, the British had sacrificed their agriculture and encouraged the export of capital, perhaps at the cost of industrial innovation and efficiency. But as the volume of trade rose sharply in the later 1890s, they reaped a rich reward. The neo- Europes in the Americas and Australasia - the heartlands of London's commercial empire - now grew rapidly as demand for their commodities soared. British trade, investment, shipping and services profited from the boom. Huge surpluses were accumulated in the balance of payments, helping to fund a spectacular growth in Britain's foreign lending which doubled between 1900 and 1913.⁶³ By the eve of the First World War, one-quarter of British output was being sent abroad; and perhaps a third of British wealth now lay there.⁶⁴ This economic success had a wider meaning. It underwrote the compromises of Edwardian imperialism. It eased the frictions of domestic and colonial politics. It helped meet the cost of naval armaments and the outbuilding of Germany whose Weltpolitik was contained if not suppressed. It deflated the tariff reform­ers' case against free trade - whose preservation was Britain's strongest card against the collective resentment of other world powers. Last, but not least, it accelerated the heavy concentration of British trade, invest­ment and shipping in the safe havens of the Western hemisphere.⁶⁵ For the survival of the British world-system, this great 'swing to the West' was to be of momentous importance.

In the last resort, however, this happy international conjunction depended upon the fragile stability of the European states-system with its volcanic periphery in the Balkans. In August 1914, the British inter­vened in the European crisis to preserve the continental balance on which so much of their geostrategic advantage depended. The result was a massive loss of blood and treasure,⁶⁶ but also striking confirm­ation of the inherent strength conferred by Britain's portfolio of mari-

time, commercial and imperial assets: the means by which the resources of America and the 'outer world' were mobilized for the struggle in Europe and the Middle East.⁶⁷ Britain suffered: her old imperial rivals were devastated. The German empire disappeared; the Russian empire shrank; the British empire expanded to its maximum extent. With Europe in disarray after 1918, its old states-system no longer seemed the pivot of global order. The best guarantee of that now seemed to lie in the co-operation of the Anglo-Saxon powers, Britain and America, joint rulers of the waves and the exchanges. To an old arch-enemy watching glumly from the sidelines, the meaning of it all was clear enough. 'So the old pirate-state, England, has... succeeded in letting Europe tear herself to pieces and... secured a victory which accords with her mate­rial interests'. Tirpitz took comfort in prophecy: 'England's day of judg­ment will have its birth in this very success.'⁶⁸

IV

Despite the stresses and strains of 'competitive coexistence', British imperialism had prospered in the open global economy of 1870-1914. The British had fashioned a hybrid system of formal and informal imperialism that seemed compatible with global conditions and regional pressures: an expanding commercial empire of free trade; a self­governing settler empire sheltered by naval power; an Indian Empire of rule and free trade; and a dependent empire inflated into a defensive glacis. After 1920, despite the economic strains of post-war transition, the burden of war debt and the dislocation of markets, there seemed a good prospect of returning to an 'enhanced' normality. The disruptive imperialisms of Germany and Russia had been eradicated by defeat and dissolution. The 'Eastern Question' had been solved by the partition of the Middle East. France was preoccupied with her European security. Japan had been co-opted reluctantly into the Anglo-American 'system' in East Asia. By the later 1920s, the spectre of Bolshevik anti-imperial­ism no longer seemed so threatening with the collapse of its alliance with Chinese nationalism, while the inflow of American capital helped to underwrite the restoration of political and economic stability in Europe. With the Locarno 'system' in Europe, the Washington 'system' in East Asia, and a League of Nations whose trusteeship ethos was notably indulgent to the old colonial powers, the decentralization of the British Empire seemed safe enough: a programme carried through in India (1919), Ireland (1921), Egypt (1922), with the 'white dominions (1926-31) and through the apparatus of mandates and treaties in the Arab Middle East (1922-30). The 'third British Empire' seemed in tune with the post-war global order.⁶⁹

Of course, this cheerful scenario rested on the expectation that the open global economy, so vital to British prosperity and to the balance of their world-system, would regain its prewar vigour and permit a full recovery from the losses of war. By 1931, this prospect had vanished in financial chaos. The implications were drastic: a fall of 8-9 per cent in the volume of world trade,⁷⁰ but a reduction of more than 25 per cent in prices, a reduction felt with particular severity by commodity pro­ducers and rural economies. The political consequences were seismic. In Europe, a radical move towards open repudiation of the postwar order; the drive towards economic bilateralism and barter, pulling Eastern Europe into a closed economic zone dependent on Germany;⁷¹ the sharpening of ideological warfare as economic failure raised hopes, and fears, of social revolution. In East Asia a parallel transformation could be glimpsed. The financial partnership and economic complementarity that had eased Japan's acceptance of the Washington system dissolved. American capital exports dried up; the American market for Japanese silk closed down.⁷² Militarism, anti-communism, and the search for autarky exercised increasing influence in Japanese politics and over Tokyo's diplomacy. The three-cornered struggle for influence in China led to open war against the Kuomintang government in 1937 and prompted the blunt rejection of a Europe-centred imperial order in the programme for a 'Greater East Asian coprosperity sphere' in 1938.⁷³ Even if by 1938 the volume of trade (though not its prices) had recov­ered the level of ten years before, economic globalism had gone into reverse. Large swathes of the world seemed destined to withdraw into the closed (or only partly open) commercial systems of Germany, Japan and the Soviet Union.

These tendencies were bound to inflict great damage on Britain's commercial 'empire' and its large political superstructure. British wealth rested upon providing goods and services for the international economy to a far greater extent than that of any other major power. The delicate web of political relations spun around the world by imperial influence as much as rule depended upon the sense of mutual self-interest especially in the commercial sphere. Indeed, much British prestige derived from the universalist appeal of liberalism, free trade and representative government. Amid the fierce ideological storms of the 1930s, the fragile entente between liberalism and empire (long sustained by liberal faith in empire as a stage towards global community) began to give way.

The most obvious symptom of British weakness was the debility of their international trade. Even in 1938, Britain was the world's largest trader, ahead of the United States.⁷⁴ But much of that trade depended upon the prosperity of commodity-producing countries, worst hit by the fall of prices, and their return purchases of British manufactures. Britain's balance of merchandise trade was bound to suffer. But that was not all. In 1913, Britain's excess of merchandise imports was com­fortably paid for by the income drawn from investment overseas. In 1938, the combined total of investment income and the invisible income from overseas services like shipping and insurance barely cov­ered the cost of imports, and in some previous years the balance had only been met by a significant export of gold.⁷⁵ As a result, rearmament in the fraught 1930s had to be slowed to ease the strain on the balance of payments. There was other collateral damage. Amid the general repudiation of war debts that took place in 1931, the British govern­ment cancelled its obligations to the United States. However necessary, it was a costly blow to British credit where it mattered most. In India, where half Britain's total land forces were garrisoned and paid,⁷⁶ the weakness of public finances, exacerbated by political unrest, threw the burden of modernizing the army back on to the Imperial centre in London. Amid the shrinkage of the global economy, all circles were vicious.

This is the global context in which we have to set the paralyzing anx­iety with which British leaders confronted the collective threat to their world-system posed by Germany, Italy and Japan, and, as some believed, the Soviet Union: four revisionist powers each in search of its own version of a new world order. The dream of Anglo-American hegemony vanished like a dream in the aftermath of 1931.⁷⁷ The British turned back to Europe since the European balance was the alter­native precondition of their imperial security. But here their indis­pensable ally, France, was a broken reed. Shorn of their prewar Russian ally and prey to ideological division, French governments were even less willing than the British to guarantee the postwar settlement and contain the expansion of Germany and Italy. The 'neo-Salisburian' statecraft on which the British had relied to balance the risks of their world-system was all but bankrupt. Amid an outlook so bleak, war seemed the only certainty.

Yet prewar pessimism scarcely prepared the British for the devastating blow that the war inflicted on their world position. Blitzkrieg in 1940 shattered the last remnants of the old European order. The destruction of France prised open the British Empire like an oyster. The Atlantic and the Mediterranean ceased to be lines of imperial communication and turned into avenues of enemy attack. The 'swing-door' of empire in Egypt became the frontline of imperial defence. Worse still, the Vichy government made no resistance to the forward move of Japan into Indo-China, the launching pad for the assault on European colonialism in Asia. When Germany turned on Russia, and Japan on the British, Dutch and Americans, globalism entered its greatest crisis. By early 1942, two vast Eurasian empires were in the making, each capable, or so it seemed, of driving deep into the Outer World: Germany through Egypt; Japan through Southeast Asia.

The British were saved in part by their own efforts, in part by cash­ing in the stored-up wealth of their age of expansion. But the survival, for the time being, of their empire should also be seen as a product of the inscrutable dynamics of the 'closed system' of world politics under which no great power could be oblivious to major changes in the allo­cation of territory and resources, however remote. An expanding world economy and increasing integration between regional economies tended on balance to soothe the inevitable friction between great power interests in all too close proximity. When those conditions were reversed by moves towards 'geo-economic' partition, the tensions latent in a dynamic closed system were bound to rise. At almost their last gasp, the British were kept afloat by this ironic twist of globalism. American willingness to court the enmity of Germany, long before Pearl Harbor, sprang from the calculation that Axis control of Britain's empire would damage American world interests, perhaps irreversibly.⁷⁸ As the second largest beneficiary of the open economy, Washington had to decide whether to defend it alongside the British or in the last ditch alone.

The global hegemony of Germany and Japan was blocked at the battles of Midway, Alamein and Stalingrad in 1942-43. Churchill's canny influence on Allied strategy ensured that Britain's imperial recovery was secured alongside the reconquest of Europe and the defeat of Japan. But by the war's end the British depended overwhelmingly upon American aid to replenish their wealth⁷⁹ and restore their world position. Churchill's famous declaration that he had 'not become the King's first minister to preside over the liquidation of the British Empire' is sometimes dismissed as the empty rhetoric of an unrepentant Victorian imperialist. In fact, Churchill's statecraft, adumbrated in wartime, co-opted by Attlee and Bevin, and sealed in the diplomatic revolution of 1948-49, was a ruthless attempt to exploit the economic and geostrategic possibili­ties of the postwar world to preserve the appearance and some of the substance of prewar power.

For a decade, global conditions seemed favourable to this enterprise. The failure to make a European peace, the mutual antagonism of the emerging superpowers, and the limits on their military capacity maxi­mized Britain's leverage as the third world power. The disorganization of East Asia and the Chinese revolution of 1949 wrecked the promise of Sino-American partnership and extended the lease of European colo­nialism in (parts of) Southeast Asia.⁸⁰ Crucially, the continuing disloca­tion of the global economy and the threat of its total breakdown could now be exploited by London (after the crisis of 1947) to protect the remainder of its financial and commercial empire against American penetration.⁸¹ The British raced to develop their closed colonial bloc in Afro-Asia. The illusion that Britain could restore much of its prewar role as the industrial and financial partner of the non-industrial world per­sisted through the 1950s.⁸² In this mirage of continuities it was possible to think that neither the 'loss' of India, nor ejection from Egypt, nor the concessions to colonial nationalism would prevent the imperial associ­ation, suitably decentralized, from being a serviceable vehicle of British world power.⁸³

In practice, the permissive (if stressful) conditions of the aftermath were too transient to allow any such revival of British imperialism. By the mid-1950s the superpowers had consolidated their grip on lesser and client states⁸⁴ and were extending their influence into the hinter­lands of Afro-Asia. As the competition for influence grew sharper, old forms of empire-building became obsolete. But new-style empires of informal influence did not come cheap. They could only be sustained by dynamic economies with the means to 'sponsor' new states and feed their voracious appetite for arms and aid - the American path; or (as in the Soviet case) by siege conditions at home and a command economy to service imperial needs. For the British, however, there was little choice by the 1950s but to try to re-enter the open international economy, newly reconstructed by American power, at whatever cost in economic uncertainty.⁸⁵ Informal imperialism was now the only option. But the cumulative strains of an extra-European 'world-role' and intra-European rivalry were loaded onto a postwar economy starved of investment and stripped of the overseas assets which had sustained it even in the years of depression. In the twenty years of crisis that followed, the familiar outline of British world power faded slowly away. Globalism and British imperialism had finally parted company.

V

If this rapid sketch of the global setting of British power bears scrutiny, it may offer a modest addition to the usual repertoire of imperial his­tory. Firstly, it reinforces the insight of Robinson and Gallagher long ago that the course of British imperialism is not to be understood as a linear progression towards a predestined future. Instead, the British throve or failed as they took the main chance offered by the shifts of the world's economy and the drift of its politics. They had to adapt their 'domestic' affairs - including the shape of their empire - as best they could to these unpredictable global permutations. Meanwhile the full implications of that protean concept, the 'imperialism of free trade', have yet to be worked out. The uneasy coexistence in the British system between an empire of trade and an empire of rule remains at the heart of the imperial puzzle. Secondly, it gives added weight to the emphasis laid by Cain and Hopkins upon Britain's commercial and financial expansion in the late nineteenth century and to their insis­tence upon its role as a prop of empire deep into the twentieth - long after the general climate had turned against the British experiment in global power.⁸⁶ Finally, it strengthens the impression that once globalism had set in after 1870 British power was at the mercy of the unstable relationship between the four indispensable elements of their world-system: Britain's own strength and status as a great European power; the resources of the City's informal empire of commerce; the military and commercial assets of India - the arm of their Asian power; and the manpower, markets and 'Britannic loyalty' of the white dominions.⁸⁷ In the late nineteenth century, it had been easy enough to hold together this bizarre centrifugal construct. Up to 1939, it had survived well enough to weather the crises of the 'globe-wide world'. But by 1960 only the husk was left. World-system shrivelled to 'empire­commonwealth'; empire-commonwealth to the vacuities of a 'world­role'; the 'world-role' to Europe. Where next?

Notes

1 For the extension of the original argument of the 'imperialism of free trade' into the twentieth century, J.A. Gallagher, The Decline, Revival and Fall of the British Empire (Cambridge, 1982).

2 D.C.M. Platt, 'The Imperialism of Free Trade: Some Reservations', Economic History Review, 2s, 21 (1968), 296-306; M. Lynn, 'The Imperialism of Free Trade and the Case of West Africa', Journal of Imperial and Commonwealth History 15 (1986), 22-40.

3 M. Daunton, '"Gentlemanly Capitalism” and British Industry 1820-1914', Past and Present 122 (1989), 119-58; G. Ingham, 'British Capitalism, Empire, Merchants and Decline', Social History 220, 3 (1995), 339-54.

4 I.R. Phimister, 'Corners and Company-mongering: Nigerian Tin and the City of London 1909-1912' JICH, 28, 2 (2000), 23-41.

5 A.N. Porter, ' "Gentlemanly Capitalism” and Empire: the British Experience', JICH, 18, 3 (1990), 265-95.

6 A.G. Hopkins, 'Informal Empire in Argentina: an alternative view', Journal of Latin American Studies, 26 (1994), 469-84.

7 J. Gallagher and R.E. Robinson, 'The Imperialism of Free Trade', Econ Hist Rev, 2s, 6 (1953), 1-15.

8 For a recent attempt, J. Darwin, 'Imperialism and the Victorians', English Historical Review 112 (1997), 614-42.

9 A.G. Hopkins, 'Back to the Future: from national history to imperial history', Past and Present 164 (1999), 198-241.

10 See Kenneth Pomeranz, The Great Divergence (Princeton, 2000), 53-4; D.A. Washbrook, 'Britain and India in the Pre-history of Modernity', Journal of Economic and Social History of the Orient, 40, 4 (1997), 421.

11 The classic account is R. Davis, 'English Foreign Trade 1700-1774', Econ Hist Rev, 2s, 15 (1962).

12 K.B. DuBoff, Accumulation and Power: an Economic History of the United States (New York and London, 1989), 14-15.

13 J.H. Moore, The Emergence of the Cotton Kingdom in the Old South: Mississippi 1770-1860 (Baton Rouge, 1988), 16.

14 Ulrich B. Phillips, A History of Transportation in the Eastern Cotton Belt to 1860 (New York, 1908), p. 54. Dorothy R. Adler, British Investment in American Railways 1834-98 (Charlottesville, 1970).

15 European migration to the Americas in the 1830s was four times the figure for the 1820s. D. Eltis, 'Free and Coerced Transatlantic Migration: some com­parisons', American Historical Review 88, 2 (1983), 278.

16 See P. Temin, The Jacksonian Economy (New York, 1969).

17 Thus China's import of opium increased fourfold 1838-1860. H.B. Morse, The Trade and Administration of the Chinese Empire (New York and London, 1908), 337.

18 S. Roberts, The Squatting Age in Australia 1835-47 (Melbourne, [1935] 1964), ch. 1.

19 H. Reynolds, The Other Side of the Frontier (pbk. edn. Ringwood, Vic., 1982), 84.

20 P. Adams, Fatal Necessity: British Intervention in New Zealand 1830-1847 (Auckland, 1977).

21 Carolyn Hamilton (ed.), The Mfecane Aftermath (Johannesburg, 1995).

22 Thus, the tonnage of Western shipping at Canton increased by 23 times between 1719-25 and 1833. See L. Dermigny, La Chine et l'Occident: le commerce a Canton 1719-1833 (Paris, 1964), II, 520.

23 Britain was the first country to permit absolute freedom of movement. M.A. Jones, Destination America (pbk. edn, London, 1977), 13.

24 Potential emigrants from subsistence economies were 'too poor to move'. K.H. O'Rourke andJ.G. Williamson, Globalisation and History (Cambridge, MA, 1999), 130.

25 R.A. Stafford, 'Geological Surveys, Mineral Discoveries and British Expansion 1835-71', JICH 12, 3 (1989), 5-32; Stafford, Scientist of Empire (Cambridge, 1989), 205.

26 Stafford, Scientist, 213-18.

27 For its receptiveness to humanitarian pressure in the 1830s,J.A. Gallagher, 'Fowell Buxton and the New Africa Policy, 1838-42', Cambridge Historical Journal 10 (1950), 36-58.

28 P. Schroeder, The Transformation of European Politics 1763-1848 (Oxford, 1994), 726-55.

29 See, for example, Elgin to Clarendon, 29 July 1857, in D. Bonner-Smith, The Second China War 1856-60 (Naval Records Society, 1954), 218.

30 P. Winn, 'Britain's Informal Empire in Uruguay', Past and Present 73 (1976), 104, n.20.

31 H. Blumenthal, Franco-American Relations 1830-1871 (Chapel Hill, 1959), 43.

32 Maori armed resistance continued into the 1880s. J. Binney, Redemption Songs: a Life of Te Kooti (Auckland, 1995) ch. 12.

33 Winwood Reade, The Martyrdom of Man (26th impression, London, 1928), 242.

34 E.D. Steele, 'Palmerston' in K.M.Wilson (ed.) British Foreign Secretaries and Foreign Policy (London, 1987).

35 R. Shannon, Gladstone: Peel's Inheritor 1809-1863 (pbk. edn., 1999), 222-23; 333.

36 For this term, E. Luttwak, Turbo Capitalism (London, 1998).

37 League of Nations, The Network of World Trade (Geneva, 1942), 9.

38 A.J.H. Latham and L. Neal, 'The International Market in Wheat and Rice 1868-1914', Econ Hist Rev 36, 20 (1983), 260-75.

39 D. Treadgold, The Great Siberian Migration (Princeton, 1957).

40 See J.P. Fogarty, 'The Comparative Method and 19th Century Regions of Recent Settlement', Historical Studies 19, 76 (1981), 412-29.

41 Even before the Chinese revolution in 1911, three-quarters of the population of Manchuria was made up of recent Chinese immigrants. For subsequent immigration, I. Bowman, The Pioneer Fringe (NY, 1931), 281.

42 See O'Rourke and Williamson, Globalisation, pp. 2-3 for a concise statement.

43 As in British India, O'Rourke and Williamson, 42.

44 As emphasized by Halford Mackinder and Leo Amery in 1904. See P. Kennedy, The Rise and Fall of British Naval Mastery (London, 1976), 183-4.

45 R.C.O. Matthews, C.H. Feinstein and J.C. Odling-Smee, British Economic Growth 1856-1973 (Oxford, 1982), 128.

46 League of Nations, Network, 84.

47 S. Pollard, 'Capital Exports 1870-1914, Harmful or Beneficial?', Econ Hist Rev 38 (1985), 489-514. Britain's net overseas assets rose from £1 billion in 1873 to £4.2 billion in 1913, a rise of £3.2 billion. Over the same period, Britain's overseas investment earnings totalled £4.04 billion, more than enough to cover the increase. See B.R. Mitchell, Abstract of British Historical Statistics (Cambridge, 1962), p. 334.

48 The Stock Exchange Yearbooks in the 1890s reveal a rapid rise in the number of companies registered for enterprise overseas.

49 P Cain and A.G. Hopkins, British Imperialism 1688-2000 (second ed., London, 2002), chs. 12, 13.

50 D. Blackbourn, Fontana History of Germany: the Long Nineteenth Century 1780-1918 (London, 1997), 315-18, for a recent discussion.

51 For Bismarck, O. Pflanze, Bismarck and the Development of Germany, Vol 3: the Period of Fortification 1880-1898 (Princeton, 1990), 123-5. Like Salisbury, Bismarck hoped to avoid the cost and trouble of ruling these colonial spheres.

52 For the mutual anxiety of Britain and France at the time of the Russo- Japanese war, G. Monger, The End of Isolation (London, 1963), 128-9, 139.

53 J. Lonsdale, 'Scramble and Conquest in African History' in R. Oliver and G.N. Sanderson (eds) Cambridge History of Africa VI: From 1870 to 1905, Cambridge, 1985).

54 J. Bryce, The Relations of the Advanced and Backward Races of Mankind (Oxford, 1902) 8-9; H.J. Mackinder, 'The Geographical Pivot of History', Geographical Journal 23,4 (1904), 422.

55 J. Harris, Private Lives, Public Spirit: Britain 1870-1914 (pbk. ed. Harmondsworth, 1994), 4-6.

56 H. Mackinder, Britain and the British Seas (London, 1902), 12-13.

57 Egypt was the test-case: hence its controversial role in British politics and the importance of propaganda tracts like A. Milner, England and Egypt (London, 1892).

58 See J.Gooch, The Prospect of War (London, 1981), 79-106.

59 Salisbury used this term in a speech to the Primrose League in May 1898.

60 R. Robinson and J. Gallagher, Africa and the Victorians (London, 1961) chs. 8, 10, 12; L.K. Young, British Policy in China 1895-1902 (Oxford, 1970).

61 For this episode, Baron Meyendorff (ed.) Correspondance diplomatique de M. De Staal, vol. 2 (Paris, 1929), 441,450; N. Rich, Friedrich von Holstein, vol. 2 (Cambridge, 1965), 617.

62 For the argument that Britain's entente policy was chiefly motivated by imperial concerns, K.Wilson, 'British Power in the European Balance 1906-14' in D. Dilks (ed.) Retreat from Power (London, 1981), 41.

63 From around £2000m in 1900 to £4000m in 1913. Cain and Hopkins, British Imperialism, 161.

64 Matthews et al., British Economic Growth, 433, table 14.3; O'Rourke and Williamson, Globalisation, 208.

65 By 1913, the Americas took 20 per cent of British exports, supplied a third of British imports, accounted for more than half of British overseas investment, and employed perhaps three-quarters of British oceanic shipping.

66 For the estimate of wealth lost, Matthews et al., British Economic Growth, 129.

67 A. Offer, 'The British Empire 1870-1914: a Waste of Money?' Econ Hist Rev 46, 2 (1993), 234-35; generally, Offer, The First World War: an Agrarian Interpretation (Oxford, 1989).

68 A. von Tirpitz, My Memoirs (Eng. trans, London, c. 1926), vol. 1, 287.

69 A. Zimmern, The Third British Empire (3rd edn., Oxford, 1934), 75.

70 League of Nations, Network, 16.

71 For the development of a German Grossraumwirtschaft in Eastern Europe after 1934, A. Basch, The Danube Basin and the German Economic Sphere (London, 1944), chs. xi, xvi; E.A. Radice 'The German Economic Programme in Eastern Europe' in M. Kaser (ed.), The Economic History of Eastern Europe 1919-1975 (Oxford, 1986), II, 300-1.

72 League of Nations, Network, 61-2.

73 F.C. Jones, Japan's New Order in Asia: Its Rise and Fall 1937-45 (London, 1954). For German abandonment of China to Japan, see J.P. Fox, Germany and the Far Eastern crisis 1931-38 (Oxford, 1982), 55 ff.

74 Matthews etal., British Economic Growth, 435.

75 Mitchell, Abstract, 334-5.

76 Approximately one-third of the British army was kept in India.

77 See B. McKercher, Transition of Power; Britain's Loss of Global Pre-eminence to the United States 1930-1945 (Cambridge, 1999) ch. 4.

78 McKercher, Transition, 293-98.

79 The Second World War cost Britain 28 per cent of total net assets. Matthews et al., British Economic Growth, 129.

80 See D. Brotel, 'Indochina (Vietnam) between National Independence and Colonial Continuity' in G. Krebs and C. Oberland (eds) 1945 in Europe and Asia (Munich, 1997).

81 Cain and Hopkins, British Imperialism, 628-9.

82 This was the view of the Radcliffe committee on monetary reform in 1959.

83 See J. Darwin, Britain and Decolonisation (London, 1988).

84 A. Deporte, Europe between the Superpowers (New Haven, 1986).

85 Cain and Hopkins, British Imperialism, 637 ff.

86 Ibid., passim.

87 J. Darwin, 'A Third British Empire: the Dominion Idea in Imperial Politics' in W.R. Louis and J. Brown (eds), The Oxford History of the British Empire, Vol. 4: The Twentieth Century (Oxford, 1999), ch. 3.

* I have benefited from the advice of Dr Ian Phimister to whom I am most grate­ful. Errors of fact and interpretation are mine.