1980 onward - Britain's industrial decline

Sooner or later in a train, at a shop or in a bus queue, someone will pipe up, “I don’t care what anyone says, we still have the best (fill in for taste - planes, cars, football team…) in the world”. A few will join in to reinforce the point with their own mismatched examples while others just nod approvingly. Some misty-eyed dropping of brand names which are no more, and assertions that Britain no longer knows how to make things. Fruitless, perhaps, to try and disentangle the economic facts from the nostalgia, but let’s try.

After World War II and into the 1950s Britain was a relative industrial powerhouse. In 1952 the country’s factories accounted for a third of national output and a quarter of global manufacturing exports. 40% of the UK workforce was employed in making things. Today the sector employs only 8% of the workforce, and manufacturing is barely 10% of GDP. In its place is a service economy - offices, banks, cafes, call centres and supermarkets selling mainly imports. What happened? And should it be a worry?

Post war industry

When Britain emerged from World War II it had a technological lead in such fields as aerospace, aircraft, communications, computers and electronics, all turbocharged in wartime. It would take time and effort for Europe, including notably a defeated Germany, to build a competitive position. But a series of poor UK decisions followed. Comet, the world’s first jet airliner, launched in 1952, suffered from metal fatigue, barely understood at the time. After a number of crashes and hundreds of lost lives, the plane had to be redesigned and remodelled. By 1958 when it was relaunched, it was behind US planes in cost and capacity.

Comet I prototype 1949

This was a warning of things to come. The elegant VC10, designed especially for flying to Commonwealth countries with short runways, found little commercial success. The Trident, too, designed for just one customer, failed on the world market. National airlines BOAC and BEA were leant on to buy British. Other nations weren’t buying. But Britain had quietly built the nose of France’s Caravelle jet. Was this a sign of the future?

Decisions in the aircraft sector (and in other areas) were often based on what may be termed ‘imperial overhang’, an unconscious need to serve far flung centres of British influence. But Concorde was a change. A Franco-British high tech, international supersonic airliner project, it broke with the ‘world beating British’ mentality. But its noise rendered it unacceptable elsewhere. It was designed for an elite, not a mass market, and its high fuel consumption made it uncompetitive. Only 20 were built. Once again Britain had backed the wrong horse.

Change in Britain's industrial structure

National pride was influencing these decisions. What was needed was a sound business strategy with efficient production to sell in a future global market. And a reorganised British Aerospace did sign up to Airbus with France, Germany and Spain. In 2000 this was revamped into an integrated company to build the world’s largest airliner, A380. For a while BAe was happy with its 20% stake, but in 2006 it sold out to EADS, so has not benefited from Airbus’ success since. In fact Britain is now effectively a fringe player in this whole industry.

High tech projects

It's a myth that advanced industries now need only one country. A series of major high technology prestige projects were backed, then cancelled, from the 1960s onward. They include TSR2, the Blue Streak rocket, and various satellite systems. In video coding, Britain backed the discarded BMAC standard. Off the radar, in the late 80s the government considered backing a British designed and built telecoms switch. These are hugely expensive (£billions) projects that absorb much time and high-tech capacity. But a detailed study found that 70% of the components would need to be imported. The world of globally agreed standards, specifications and protocols was more complicated than the government had imagined. International partners were needed, not a ‘British switch’, world beating or otherwise. 

Conservative governments in the 1950s had a rather laissez faire view of large industrial projects, often spiced with an imperial mindset to back UK companies. And from the mid-60s Labour tried unsuccessfully to create national champions in industries deemed essential to the economy. Scale was seen as key. Industrial economist Geoffrey Owen says, “There was a mistaken assumption that there were certain technologies which a country somehow needed to have, and that they were more likely to be acquired through centralised direction than through competitive markets. The cost to the taxpayer of ill-judged industrial policy was high”. 

'Horizontal' policies and 'market failure' 

Things switched again in the 1980s, with the new Conservative government, to ‘horizontal’ policies. Liberalisation and deregulation would improve the environment for all firms. Privatisation was a key component of this approach. Still, many private companies went bust or were reorganised with global partners over the next 20 years. It wasn’t just smokestack sectors that went. Big names like GEC and ICI disappeared, as did the British car industry, though it survived as a thriving international version.   

Disappearing British industrial giants

‘Market failure’ was usually cited as a key problem. In the 1980s common wisdom said that left to themselves, markets would allocate resources efficiently, a rather simplistic 18^th century type of notion. This is another catch-all myth. In modern practice, with innovative industrial development, companies might not have the resources for costly research and development. This may bar entry to suitably qualified firms, or if they take the risk, simply hand the benefits to competitors.

The 1988 White Paper ended most support for single company R&D and placed its emphasis on a collaborative approach. It retreated even further into the catch-all of market failure. Industrial policy writer Alex von Tunzelmann says while you can sometimes blame market related costs for the fundamental shortcomings of policy making, “it doesn’t mean that providing a market would have resolved the problem identified - often indeed it might have exacerbated it”.

Complex decisions and a blame culture

BMC rosette

It took a while to realise the complexity of policy choices. Industrial strategy could not be based on backing winners or on seed money for innovative start-ups that might pay off. A more basic reason for failure was inadequate collaboration and what might be termed inter systemic issues - breakdowns between national spheres of science, innovation, finance, training and workplace organisation. Thus it was really a failure of alignment of the key factors. It gave rise to a mythical blame culture in Britain - 'the government and/or the banks didn’t back it'.

From the late 80s and 90s something resembling the right balance between competition and cooperation was developing, with partial liberalisation of previously protected sectors like telecommunications and electricity. Much of this was pursued in Europe via the Single Market which opened up a far bigger range of opportunities. New institutions - the Framework Programme and Eureka - were set up to promote intra-European cooperation in research. They have largely worked well, in contrast to some catastrophic UK government IT failures.

Europe's Eureka programme logo

There's a pot pourri of reasons for Britain’s industrial decline. Short termism in finance, misplaced belief in imperial trade patterns, being slow to seek international partnerships to spread costs and tackle global markets, and, of course, changes in fashion and society. But erratic government policy must take a share of responsibility. The last few years has seen a debate - is it time for a more active industrial policy? There is also wide agreement that what industry needs most is continuity, with a consistent focus. Brexit has scuppered that.

The services alternative?

In the 1980s Chancellor Lawson asserted that services would pick up the slack from industrial decline. He called the case for manufacturing “special pleading dressed up as analysis”. In fairness the development of services was inevitable. Britain is not alone - most advanced economies in the last 25 years have seen a big switch to services. But being able wholly to replace manufacturing is a myth. And Britain may have rather overdone it. Economist Robert Skidelsky shows that a huge rise in financial services has led to more short term thinking. Investors want quick returns, so companies spend too little on R&D with insufficient emphasis on management and advanced production.

Chancellor Nigel Lawson 1985

Manufacturing protects against per capita income deterioration as it’s more productive than most services. The greater the number of people employed in labour intensive, especially retail services, the lower the typical income is. The ‘not invented here’ syndrome has fortunately gone. And there are several successful industries where British companies have a large stake - in pharmaceuticals for instance. But Britain’s government had a serious structural deficit in 2008’s crisis, and the country was worse hit than those with more diverse economies. This over reliance on financial services gives the UK an unbalanced portfolio. And it may get worse.

1979 The Thatcher Effect

When Margaret Thatcher became Prime Minister in May 1979 it marked a break point in British history. She was, of course, the country’s first woman PM, and among the first in Europe. But her election also represented a systematic rejection and reversal of the post war political consensus, where the main parties agreed on the principles of Keynesian economics, the welfare state, a balanced mix of public and private sectors, and close regulation of the economy. The main exception to this was to be the National Health Service.

Margaret Thatcher 1983

The 70s was a tough time for Britain, with deep economic and social divisions, a declining industrial base and bad work practices. Rampant inflation, inefficient state-owned companies, government deficits, low investment and worker unrest typified the period. What’s not always realised is that other industrialised countries were hit by a permutation of these same factors. As historian David Priestland says, “It was clear that economies needed to be retooled to take account of a new economic environment. The question was how was this to be achieved.”

The new economy

Thatcher’s 1979 election win followed a minority Labour government that ended after the ‘winter of discontent’. Official and wildcat public sector strikes, at their most graphic with coverage of the dead going unburied, made it seem Britain was ungovernable. Thatcher’s prescription was theoretically based on the monetarism of Friedrich Hayek - inflation was caused by too much money in the economy, so the government must control the money supply via interest rates and financial discipline. Free markets and privatisation were then added to the recipe.

Milton Friedman

Hayek and Milton Friedman’s Chicago School ideas were doing the international rounds. And Britain certainly needed a jolt. But the fate of erstwhile major industries like cars, ship-building and mining was sealed even earlier, with some hard decisions postponed against a background of developing globalisation. It’s worth pointing out it was not just Thatcher supporters who wanted stricter control of inflation. By 1979 Labour Chancellor Healey had already adopted some monetarist policies like cutting public spending and selling the government’s stake in oil company BP.

A common view of Thatcher’s macroeconomic performance is that things were handled well, but the Major government messed it all up. This is simply untrue. While ‘supply side’ measures and some structural reforms had a positive impact, her macroeconomic policy was pretty diastrous. High interest rates, an overvalued pound, and a deep recession caused huge unemployment. By contrast the Major government, says Duncan Weldon, “eventually stumbled into a macroeconomic framework that appeared to work.”

Monetarism?  

A related ideological misperception is that Thatcher's government was monetarist. In theory maybe, but in practice it was not. 1980’s Medium Term Financial Strategy guiding policy from 1979 to 1983, had targets to reduce growth in the money supply. These were overshot, so in 1982 they were revised upwards, rather moving the goalposts. A broad definition of money known as M3 continued to exceed its target. Public borrowing was kept in check by the balance sheet ruse of netting off privatisation proceeds. In 1985 money targets were moved to a narrow range and then quietly dropped completely. Purists rightly claimed monetarism had been abandoned.

Miners' strike rally 1984

The government did believe in supply side economics. It intervened to create a free market by lowering taxes, privatising state industries and restraining the power of trade unions. The 1984-85 confrontation with the miners’ union (NUM) was the key trial of strength in this sphere. Scargill’s miners were defeated, a clear victory for the government. In fact laws to check union power were among a raft of measures used to improve the economic environment generally. They were retained by her successor, and later, by the 1997 Blair government.

Boom and bust 

Reduced demand in the economy and high unemployment especially in industrial areas, plus a strong pound, had helped reduce inflation to 3% by 1986. The government then thought it had slain this dragon so it could re-heat the economy. Interest rates and taxes were cut, creating the late 80s boom. But by 1990 inflation had risen to over 10%. It took a new squeeze and near 15% interest rates to bring it down. Recession, then unsustainable boom, followed by another recession, is hardly a good record. But it’s the Thatcher legacy. Stop-go, or boom and bust. And rather against common wisdom the tax take as a share of GDP remained at around 40% throughout the period. 

The main Thatcher policies were deregulation, privatisation, trade union marginalisation, reduced public spending, tax cuts and moving power from local authorities to central government. Thatcherism, a term barely used by Thatcher herself, was neatly summarised as “the free economy and the strong state”. The wolves often gorged on the sheep. Libertarian in outlook, it relied on a streak of authoritarianism in practice. And liberty was not spread equally. As Isaiah Berlin had remarked “Freedom for the pike is death for the minnows”. 

Political salvation

The economic shock to Britain from Thatcher’s election in 1979 was probably necessary. But it was carried out in a socially divisive way. Unemployment grew fast as austerity budgets and high interest rates hit industry hard. But the Thatcher government did much to help the City of London, with a structural shift from industry to finance that Britain is still struggling to manage. In 1982 with 3m jobless and low opinion poll ratings her economic policy was widely criticised publicly and in government. She would probably have lost the 1983 election, other things being equal, but was clearly saved politically by the 1982 Falklands war.

Some think that Thatcher’s economic policies were a success. While the early jolt was important, psychologically as much as anything, Britain’s growth rates in the 1980s were scarcely higher than those of the 70s. They could even have been lower without the windfall from North Sea oil coming on stream. It’s true that productivity rose by 11% in the period, mostly due to high unemployment. Compared to countries like Germany, though, where productivity rose 25% with little industrial or social damage, the UK figures were disappointing. Indeed the key period of sustained growth was from 1993 to 2007 under the Major and Blair governments, well after Thatcher.  

Anti poll tax rally 1990

Apart from trade union law to free up labour markets, the only policy to have brought some lasting measure of success is the privatisation of industries like gas, electricity and telecoms, though clearly not all have worked out well. It’s a key part of the Thatcher legacy as this model has been taken up by most countries around the world, including the European Union. Even France, slow to relinquish state control, is largely on-side.

Housing policy

Against this the council house sell-off had drawbacks that have now become clear. There are many reasons for today’s acute housing shortage - demographic change and life expectancy, the rise in single person households, variable planning rules and rising expectations - but the absence of a municipal housing supply is crucial. One reason for the ballooning UK welfare budget is the huge sums the state has to pay to private landlords (including those who now own a large proportion of the ex-council houses). An astonishing 51% of private tenants in 2020 had their rent paid from benefits.    

The housing shortage and other structural problems in the economy were not so clear during the 1990s and 2000s. The consequences of a lack of infrastructure investment and an imbalance from an overload of financial services were largely hidden. It was only in 2008 with the global financial crisis that the true state of Britain’s economic affairs was evident. The country was left with a problem legacy. It was a most uncomfortable realisation. Says Priestland, “The model built by Thatcher was being sustained by debt”.

Thatcher in balance

Some Thatcher plus points. She used shock tactics to shake the British economy in the 80s, against common wisdom. She took on the unions to boost the economic supply side, and put Britain in the international vanguard of deregulation and privatisation. A committed campaigner to stay in the then EEC in 1975, she was a driver of Europe’s Single Market in the 80s. Firm in the Falklands crisis and brave when the IRA bombed her hotel during 1984’s Conservative party conference, she was a strong, driven personality and always hard working.

Oil drilling platform, North Sea

Against this her economic policies became inconsistent and after a dramatic start yielded poor long term results, especially in housing. She took the credit for successes but blamed others for failures. Not a consensual figure, she fell out with colleagues like Michael Heseltine, Nigel Lawson and Geoffrey Howe. She was lucky with her enemies, like miners’ leader Scargill and Argentina’s Galtieri. She was aggressive, and determined. In her third term she listened less, and became more truculent in both European and domestic spheres, pushing a disastrous Poll Tax against advice. Successor John Major later said she was “a profoundly unconservative” figure with “warrior characteristics”.

It’s been claimed that the advent of the Social Democrat Party which with its Liberal allies won nearly 25% of the vote in 1983’s election, prevented Labour from gaining power. This is an abiding fantasy of the left. Detailed analysis has convincingly shown that idea to be wrong. Tony Blair later wrote “Britain needed the industrial and economic reforms of the Thatcher period”. Many fair minded people might agree. But the belief in a property stake shows up badly today, when young people can’t get their foot on that ladder.  

Margaret Thatcher during 1990's leadership vote

The basic Conservative contradiction is clear. A thrusting 19^th century Liberal idea, breaking social, technical, economic and legal barriers to grow business? Or a provincial, traditional Toryism, with local links, social bonds and inherited wealth? They’re in conflict, as are related themes of enterprise and nationalism. British initiatives now often come from immigrants via a cosmopolitan London, bypassing much of the UK which sees an erosion of traditional values. Thatcher never squared this circle. She's a divisive figure - not as good as her fans claim and not as bad as her detractors say.

1963-69 The Swinging Sixties

‘If you remember the sixties you weren’t there’ as the phrase goes. Nonsense, of course, and the whole subject is full of such myths and misconceptions. But it was still a period that saw an undeniable wave in Britain, with a big shift in cultural values backed by political and social change. The country experienced a revolution in design, art, music, film and fashion - new service industries making London a leading cultural centre and a magnet for talent from all over the world.

But let’s not throw the baby out with the bathwater. It was, at least at first, a strongly London based wave. Time magazine seems to have coined the idea with its 15^th April 1966 cover “The Swinging City”. A piece in that issue proclaimed, “In a decade dominated by youth, London has burst into bloom. It swings; it is the scene” - the Swinging label was born.

Time magazine cover "The Swinging City"

The sixties in memory

For many people, the sixties remain a fond memory. On the surface they think of the fashions, ‘sex, drugs and rock and roll’, the radicalism of pop culture and the freedom of a more permissive society. As Philip Larkin jokily put it, “Sexual intercourse began in 1963 (which was rather late for me) - Between the end of the Chatterley ban and the Beatles’ first LP”. Others will see it as a progressive and more tolerant era of social reform and even transformation, with the end of the death penalty, liberalisation of homosexual and abortion laws, a lower voting age and weakening of class divisions. Politically the 60s was animated by human rights, Anti-Apartheid, and the fallout from 1962’s Cuban Missile Crisis. 

The Beatles' first single record

For yet others, including many of a more traditional mindset, it was the opposite. Establishment values were mocked and satirised, and the roles of family life, authority and religion questioned. Opponents of this new culture were discomfited and saw the start of what was a less hierarchical and deferential age as the end of the world as they knew it. The 60s was a period of moral decline, they believed, the time the rot set in.

Culural and social reality?

The ‘sixties’ as a phase really did begin in 1963. It was when PM Macmillan resigned, after a scandal involving Jack Profumo, a government minister, and good time girl, Christine Keeler. As it involved a Soviet spy and aristocratic names, it was a tabloid dream. But it exemplified the start of an inter-generational culture war.  In 1964 a Labour government was elected and provided a political base for the social changes to come.

Christine Keeler going to court, 1963

Dominic Sandbrook has cleverly pointed out in his Never Had It So Good the numerous myths and misconceptions about the era. At the time of such musical innovators as the Beatles, who carried fans with them through the 60s on a long, ever changing creative journey, South Pacific was the top selling record album for 46 weeks. Two versions of The Sound of Music occupied the charts for five years. 20 million regularly tuned in to watch The Black and White Minstrel Show on TV. Mmm - little evidence of an appetite for creative innovation there.

Miniskirts were a key image of the times but outside London they were slow to catch on. And by the end of the 60s only one in ten women had used the contraceptive pill. In 1964 most teenagers were virgins at 19. Feminism, and its media creation ‘women’s lib’ did not take hold until the 70s, 10 years later. While this 60s period was arguably the first time people in the working class had money and a degree of cultural respect, they retained a largely conservative outlook. In 1969 polls showed most Britons wanted to restore capital and corporal punishment, and 80% supported making smoking cannabis a crime. It hardly suggests a liberal and tolerant public mood.   

Facts and figures

The key dates in the decade were perhaps 1964, with a new Labour government and the Beatles’ musical breakthrough, and 1966, when England won the World Cup at Wembley. 1967’s Summer of Love is often recalled in hindsight, but was maybe more of an American than a British phenomenon. The devaluation of the pound in 1967 seemed a major event at the time, too, if not today. Less remembered is the inaugural Concorde flight in 1969, the result of a major Anglo French aerospace project. It encouraged a feeling of European co-operation.

The Concorde supersonic passenber aircraft 

Whatever the generation or sub-culture, the 60s was certainly a time of growing prosperity. The proportion of owner-occupied homes rose from 41% at the start of the 60s to nearly 50% at the end. In 1960 only a third of households owned a car but by 1970 nearly 50% owned one or more cars. Motorway building to accommodate these extra vehicles was a feature of the 60s. Disposal income became a reality for many people and they chose to spend much of it on services - entertainment, sports, foreign holidays - and not simply on ‘things with plugs on’.

Motorway building programme       

London effect

Clearly some pre-conceived notions about the 60s are wrong, as Dominic Sandbrook points out. For most people outside London life and attitudes went on much as ever. Unless you were a rock star it wasn’t easy for young people to acquire cocaine, cannabis and LSD as is sometimes supposed. Films and TV drama may have fostered images of sexual freedom but social research suggested most men just wanted their women keeping house and raising children.

So where does the truth lie? There's no doubt that traditional values were rejected by a large minority of young people, particularly in London. And there is clearly a progressive legacy from the 60s of social reform and tolerance enshrined in law. But the leaders of this culture or ‘influencers’ as they might now be called, were labelled insidious radicals causing huge damage to the accepted order.

Reconciling progress and tradition

Sociologist Frank Furedi has shown that there had been a general lack of intellectual thinking about how a society with rising prosperity could accommodate and reconcile authority, family life and religion. These questions were not really answered. In this vacuum a handy media-packaged idea of ‘The Permissive Society’ was justification, explanation and scapegoat for left and right thinkers alike.

Movie poster 1967

On today’s intellectual confusions, Furedi writes, “The 1960s did not create these problems. Indeed one of the positive consequences of that period was that it brought the intellectual and moral crisis of modern society out into the open…The authoritarian imagination confuses permissiveness with the prevailing climate of non-judgmentalism. Permissiveness is a precondition for a truly tolerant society, but tolerance should not mean a reluctance to make moral judgements or to take strong stands against forms of behaviour deemed wrong”.

But accepting, perhaps against common wisdom, that the 60s didn’t create what some see as these contradictions, it did expose the absence of thinking about them. Tolerance, permissiveness and lack of respect for traditional values are part of the development of society across the ages. The changes would have happened anyway, as they did in other countries. But the myths and fantasies of Britain in the 60s are still with us.

1956 Suez

The Suez Crisis, sometimes called in the Arab world the Tripartite Aggression, erupted between the end of October and the first week of November 1956. Britain, France and Israel invaded Egypt with the aim of regaining Western control of the Suez Canal (it had been nationalised by Egypt), and removing Egyptian President Gamal Nasser. Pressure from the USA, Soviet Union and the UN led to a withdrawal by the three invaders. A humiliation for Britain and France, but a political boost for Nasser and the Soviet Union. The verdict of history is that Suez signified the end of Britain’s role as one of the world’s major powers. Was this true?

Crisis background

Some history to understand and contextualise the event is worth sketching. France had built the Suez Canal in 1869. When in 1875 the Khedive went bankrupt Britain bought Egypt’s 44% stake. At that stage 80% of traffic through Suez was British. It’s not true as often claimed that Disraeli decided this off his own bat. Nor was it the start of an extended British commitment in Egypt. Such a commitment was the unintended consequence of a pragmatic policy. The aim was the opposite, to control but minimise British entanglements in the east.   

Opening of the Suez Canal 1869

Egypt, never officially part of the Empire, was a British ‘protectorate’ but without legal support. Egypt had been pivotal to Britain’s global strategic position, with the Suez Canal critical for India and Far East trade links and for its proximity to Britain’s Gulf oil supplies. When the protectorate was ended in 1922 little changed, as Britain kept a strong base and armed forces at Suez. Britain’s Cairo Embassy was in practice the Middle East’s dominant power centre.

Protecting the Canal

The November 1942 battle of El Alamein was fought not so much to defend Egypt, but to prevent Axis control of the Suez Canal. Though Britain had difficulty convincing the Americans of its importance, this was rightly seen as vital for supplies to Britain in World War II. It also made better and more time effective use of available shipping. A huge array of manpower, firepower and airpower was deployed against the German Afrika Corps to this end. 

In 1952 a coup overthrew Egypt’s monarchy and established a republic. Nasser emerged as the strong man. He was a nationalist who aspired to leadership of the wider Arab world, and there was a steady rise in hostility to British troops in Egypt. Nasser’s anti-colonialism and Arab nationalism, popular in the region, were seen as a clear threat to Britain’s influence in Jordan and Iraq, and to France, with its control of Algeria.

Anthony Eden

In 1953-54 Britain worked hard to mend relations with Egypt and agreed on a phased reduction of troops from its retained Suez base. The Canal was re-scheduled to come under Egyptian ownership in 1968. But relations with Egypt remained tense, as Nasser looked to play the major powers off against each other. After being armed mainly by the US, Egypt acquired substantial armaments from Czechoslovakia, signed off by the Soviet Union. Nasser also hawked around a project for a high dam in Aswan, to see who would seek to gain influence by paying for it.

Collusion

In July 1956 Egypt nationalised the Suez Canal. Convinced Nasser must be removed, Britain, France and Israel then discussed a secret plan in a meeting at Sevres. Israel would invade Egypt, moving towards the Suez Canal, on the pretext of rooting out territorial infiltrators. Britain and France would then condemn this, telling ‘both sides’ they had to stop fighting. Each would be told to retreat 16km from the canal, and then British and French troops would be landed to ‘protect the canal zone’.     

Bombing of Port Said

On 1^st November British and French aircraft began strikes against Egypt. By the evening Egypt’s 200 plane air force had been destroyed. Airborne landings by British and French paratroops followed, with bombing and Royal Marine attacks on Port Said causing huge damage to the city. Most of the Canal Zone was soon occupied. But Egypt sank all the vessels in the canal, blocking it to shipping. Some 2000-3000 Egyptians were killed in the operation.  

US intervention 

On 6^th November PM Eden announced a cease-fire without discussing it with either France or Israel. This followed a demand from the UN and heavy political and diplomatic pressure, particularly from the US. President Eisenhower had strongly warned Britain not to invade (the CIA knew in detail of the plans). He credibly threatened to sell the US government’s pound sterling bonds, which would have caused serious financial damage to Britain.

An embarrassing withdrawal then began. The Suez Canal was not re-opened until March. And Israel didn’t complete its pull-out until April 1957. Collusion between the three invaders was thinly disguised and widely recognised at the time. But Britain doubled down, continuing absurdly to deny it for years. It later emerged there had been opposition from several military and political figures, including First Sea Lord Louis Mountbatten, but at the time there were few resignations apart from Eden, who quit on grounds of ill health.

Policy failure

Suez wasn’t just about global trade, principally oil, but also political influence. A major symbol of British global power it became an obsession for Prime Minister Eden. The USSR had to be kept out of the area. Comparisons were made with Hitler and Mussolini, and how it would have been better to have stopped them at source. This was clearly true. But Egypt hadn’t invaded other nations or laid claim to other territories, so the circumstances were in no way analogous. And the Suez Canal did run right through Egypt.

Harold Macmillan

So what are the other myths? Against common wisdom Suez did not mark the watershed in the decline of the British Empire - that had been in WWI nearly 40 years earlier with the Grand Declaration on India and the Treaty of Versailles. The retreat from the Middle East had also begun well before Suez, with Palestine in 1948 and Abadan in 1951. It’s just that slow learners hadn’t appreciated it.

In the way of these things few could later be found to defend the Suez action, but the British public at the time, with its usual ignorance of foreign policy issues, mainly supported it. There was some anger when the Canal was nationalised, but views were generally resigned to the fait accompli by October, particularly as dire warnings of chaos if Egypt managed the Canal proved groundless. Yet in November, once British troops were actually at war, public opinion quickly came to support the action - a ‘rally round the flag’ moment.

Diplomatic fallout

The Soviets threatened to launch nuclear attacks on European cities. This might not have been taken seriously - aerial photography suggested Soviet leader Khrushchev was exaggerating his capability - but it fuelled the fire. The Soviet invasion to put down the Hungarian rebellion took place simultaneously. It was a violent repression, but not firmly opposed by the West, mainly because world attention was distracted by Suez.

Says Alex von Tunzelmann, “Suez was the tipping point between the period of imperial European rule, where France and Britain had a major say in the world…and the US and Soviet Union having a lot more sway. It represented a move towards superpowers, rather than empires, running the show”. But British influence was declining without Suez. Foreign Secretary at the time Selwyn Lloyd later said “Suez became the excuse, the scapegoat for what was happening to Britain in the world, for all that flowed from the loss of power and economic weakness”.

Dwight D Eisenhower

Finally even now it’s sometimes said by those of nationalist inclinations that a humiliated Britain was stitched up by the US. That things were going fine if only the Americans hadn’t pulled the rug. This is quite untrue and the final myth of the episode. Eden and his Chancellor of the Exchequer Harold Macmillan had fatally convinced themselves that the Americans would permit the invasion. The US warned Eden in public and private that he should not even contemplate such a course. The State Department believed the reaction in the Arab and Moslem world, and in the Third World beyond, could open the Middle East to the Soviet Union and it would be lost to the West for good.

Longer term legacy

Britain, reduced to an international pariah and threatened with severe economic sanctions, had no choice but to disengage. That Eden lied to Britain’s major ally and guarantor of its freedom, as well as to the public at large, damaged UK-US relations for some time. Eden’s successor as Prime Minister, Macmillan, worked to improve things. But as former Secretary of State Dean Acheson famously remarked in 1962, “Britain has lost an empire and not yet found a role”.

In more recent times some Brexit supporters have promised a re-assertion of Britain’s international influence and independence. With none so blind as will not see, there’s a danger the same mistakes could be made again. As historian Andrew Jones says, “It is clear that the ghosts of Suez are still far from being put to rest”.