The ‘financial theme' and imperial relations
Cain and Hopkins are right in claiming that British imperial policy (and to a certain extent colonial policy) during the period after 1945 can only be fully understood by drawing on economic and especially financial relationships.
In this very general sense, I am in agreement with the argument advanced in their book. If one assumes that continuity simply means that financial relationships played a role during the period and, moreover, that imperialism is a control relation, then one can accept that there was a continuity in British imperialism down to the Suez crisis of 1956, which is also the watershed identified by specialists of decolonization.16 This point could be substantiated extensively with historical evidence, far more than British Imperialism provides in the limited space available. As I have argued elsewhere, archival sources underscore the importance of sterling relationships during the period as well as their role in the key policy debates assessing political control in British foreign and imperial relations.17 For the present purpose, I will simply pinpoint some principal elements, which are also relevant to the conceptual suggestions at the end of this article.Domestic and external factors imposed priorities on British policy emphasizing financial relationships. These issues include the problem of the British balance of payments during postwar reconstruction and designs of welfare capitalism; the sterling exchange crises, which posed challenges for the management of the pound; and Anglo-American relations, given the twin problem of re-establishing an equilibrium in the world economy between the dollar and sterling areas and the striving for liberal multilateralism in a new international economic order.18 Therefore, discriminatory policies were implemented with regard to the dependent sterling area's commodities, which proved vital in relations with the dollar area for 'dollar saving' and 'dollar earning'.
As a result, the economic role of the colonies for Britain increased during the late 1940s and early 1950s, triggered by the convertibility crisis of 1947.19 The resulting policies cannot be interpreted as merely reflecting wartime approaches which had not yet been phased out. Rather, this point ushered in a distinct policy approach towards British imperial and external economic relations. In the absence of colonial control, the discriminatory trade policies, necessitated by Britain's position in the international economy, would not have been feasible and the colonial contribution to Britain's balance of payments less marked. As a matter of coincidence, policies were complemented by other factors, such as boom periods for some commodities (for example, with regard to rubber, less so cocoa) and the fact that the imports of consumer goods could be restricted more easily in some colonies than in the independent sterling area. Colonial economic policy was an intrinsic part of the overall management of British external economic relations. Decisions concerning import restrictions and 'dollar ceilings' were taken in the main interdepartmental committees under the aegis of the Cabinet Office or co-ordinated in the short-lived Ministry for Economic Affairs, whereas the role of the Colonial Office was, on the whole, limited to assessing administrative needs and the political feasibility of economic policies.20British relationships with the empire underwent considerable change during the period both in structural and policy terms for a variety of reasons. The need, feasibility and desirability of discriminatory management and direct control diminished in the course of the 1950s. The dollar gap was closing and liberal multilateralism imposed its own dynamic on policy-making, as did the challenge from the European Common Market. No further extension of discrimination was feasible and it was proving politically costly, especially in areas in which direct political control was crucial, such as with regard to import controls. Developmental objectives on the periphery and in Britain proved ultimately irreconcilable, which ended the 'common cause' advocated earlier. The relevance to cosmopolitan sterling relationships of colonial
commodities was questioned, given changes in trade flows and the expected fall in commodity prices. As a result, north-south relations became far less relevant for the British economy than previously had been the case, and the empire passed into oblivion almost unnoticed. States on the periphery also changed during the period, which in some territories, though not in every case, made British policy designs increasingly difficult to execute as the 1950s wore on.21