54.Britain’s Industrial Future: Report of the Liberal Industrial Inquiry, London 1928; Lloyd George gave £10,000 to finance it and hosted its meetings at his country house at Churt. Hubback, No Ordinary, pp. 77–80.
55.‘Our Export of Capital’, 11 February 1928.
56.‘Is the Financier a Parasite?’ 14 July 1928; Boyce, British Capitalism, p. 172.
57.‘Monetary Policy and Prosperity’, 18 August 1928; 1 September 1928; ‘Mr Lloyd George’s Pledge’, 9 March 1929. Keynes, ‘How to Organize a Wave of Prosperity’, Evening Standard, 31 July 1928. Layton had made a similar point about fiscal policy in spring 1924 in the Nation and Athenaeum, in which Keynes accused him of wishing to ‘sit by smiling’ and wait for unemployment figures to ‘cure themselves’. Keynes, CW, Vol. XIX, p. 218; Robert Dimand, The Origins of Keynesian Revolution, Stanford 1988, p. 89. Layton generally backed public works, while cautioning against monetary experiments. See, The Third Winter of Unemployment, ed. Walter Layton, London 1923, pp. 81–82; Is Unemployment Inevitable? An Analysis and a Forecast, ed. Walter Layton, London 1924, pp. 80–81, 83–84, 165–85; Britain’s Industrial Future: Liberal Industrial Inquiry, London 1928.
58.‘A Protectionist’s Mare’s Nest’, 23 February 1929.
59.The semi-official conference, hatched in 1925 at Belgium’s third International Chamber of Commerce, gathered 194 delegates and 226 experts from fifty countries; Layton tried to leverage Britain’s position as the world’s largest importer to obtain pledges to lower tariffs. The Economist called it ‘a landmark in economic history’: 28 May 1927; see Boyce, British Capitalism, pp. 116–22. For a tariff on the grounds that modern capital mobility undermined the classical case for pure free trade from the likes of Douglas Graham, see the Economist 3 November 1928; 26 January 1929; 23 February 1929; The Truth At Last About Free Trade and Protection, London 1928.
60.‘The Effects of Foreign Lending’ and ‘Note of the Week’, 9 March 1929.
61.Since this was probably not what the editors had in mind, ‘I still await an answer to my question’: 16 March 1929.
62.‘The Effect of Foreign Loans’, 23 March 1929.
63.‘The Effect of Foreign Loans’, 6 April 1929.
64.At this stage Keynes was optimistic about the City holding its own amidst the Wall Street boom. ‘Bank rate: Five and a Half Per Cent’, Nation and Athenaeum, 16–23 February 1929. Much of these exchanges appeared in A Treatise on Money in 1930, with general conclusions about foreign and home investment in an ‘old country’. Keynes, CW, Vol. V, p. 312.
65.For ‘mandarins’, see Keynes to Churchill, 13 May 1928, in CW, Vol. XIX, p. 749. Keynes backed ‘tied’ lending in the Nation and Athenaeum and managed to insert it, presumably over Layton’s objections, in the Liberal Yellow Book; it received support from left as well as right – in the Empire Review, Morning Post, National Review – and from the Foreign Office: Boyce, British Capitalism, pp. 175–76, 302.
66.Keynes and His Critics: Treasury Responses to the Keynesian Revolution, 1925–1946, ed. G. C. Peden, Vol. XXXVI, Oxford 2004, pp. 58, 69, 77.
67.And for what seemed selfish policies of hoarding meant to enfeeble Britain, according to the Banker, Observer, Daily Herald and Financial News – though not the Economist: Boyce, British Capitalism, p. 291.
68.Charles P. Kindleberger, A Financial History of Western Europe, London 1984, pp. 378–79.
69.Even in the Macmillan Report, Keynes rejected devaluation and defended the honour of the City, which up to 1914 had provided the flow of investment capital, trade finance, insurance and other services the world economy needed; New York and Paris had joined London as financial centres as a result of the post-war reparations and debt payments, but were lending ‘only spasmodically’, leading to liquidity crises: Boyce, British Capitalism, p. 331.
70.Though not if the assets were frozen abroad. ‘Exchange Crisis’, 8 August 1931. The report ‘grossly underestimated’ foreign claims on London, which were probably closer to £640 million, according to Kindleberger, Financial History, p. 378.
71.Walter Layton, The Economic Situation of Great Britain, London 1931, p. 35. The failure to foresee trouble on the horizon is striking given that the chairman of the Economist’s board, Henry Strakosch, was also a board member of Kreditanstalt, an important conduit for English capital into Austria. Boyce, British Capitalism, pp. 306–31. Appointed to the Committee of Enquiry for European Union, Layton was ‘convinced a great opportunity had been missed’ in the summer of 1931. Layton later claimed that after personally winning agreement from Austria, Germany, France, Italy and Sweden to lower tariffs to a maximum of 10 per cent, first Snowden and Samuel (‘self-righteous all-out Free Traders’), and then Chamberlain blocked the deal. Raymond Streat, Lancashire and Whitehall: The Diary of Sir Raymond Streat, Manchester 1987, Vol. I, p. 162.
72.‘The British “Crisis” ’, 22 August 1931.
73.‘Democracy and Economy’, 15 August 1931. Even if the May Report exaggerated the budget shortfall, such was the need for economy, it was acceptable ‘to make the public’s flesh creep’: ‘A New Axe’, 8 August 1931.
74.‘The Government and Its Tasks’, 29 August 1931. The mutiny at Invergordon was described as ‘reports of insubordination in the Navy’. ‘The End of an Epoch’, 26 September 1931.
75.‘Harvest of Ottawa’, 27 August 1932; ‘Ottawa and the Loaf’; ‘Liberal Ministers’, 17 September 1932. For the split between Samuelite and National Liberals over tariffs, see David Dutton, ‘1932: A Neglected Date in the History of the Decline of the British Liberal Party’, Twentieth Century British History, March 2003, pp. 43–60. Hirst, now head of the Free Trade Defence Committee, was more adamant: ‘the Tariff of Abominations, the worst since Waterloo … it is now the turn of the colonies to control the mother country’s taxes!’: Frank Trentmann, Free Trade Nation: Commerce, Consumption, and Civil Society in Modern Britain, Oxford 2008, pp. 331–32.
76.Layton to MacDonald, 27 September 1933, Layton Papers, TCC. ‘I assure you that I desire with all my heart that you will not lose touch with me but that whenever you want to say or write something, access remains as free as ever’: MacDonald to Layton in Hubback, No Ordinary, p. 123. MacDonald appointed Layton along with Keynes, Stamp, Salter and others to his Advisory Committee on Financial Questions just after the gold rout in 1931. Roosevelt put paid to the ‘goldbug’ plan, refusing to attend the London conference, then devaluing the dollar while it met. For a perplexing claim the Economist drew ‘sanguine’ lessons about democracy from the London Conference, see David Runciman, The Confidence Trap, Princeton 2013, pp. 109–10; ‘A World Adrift’, Economist, 4 June 1932.
77.C. H. Rolph, Kingsley: The Life, Letters and Diaries of Kingsley Martin, London 1973, p. 164.
78.Keynes sent ‘Notes on the Currency Question’ to Leith Ross, Montagu Norman and Hubert Henderson on 16 November 1931 after a speech to the Political Economy Club on the same theme. Keynes, CW, XXI, p. 17.
79.Ibid., pp. 24–6.
80.Skidelsky, Keynes, Vol. I, pp. 309, 340–44.
81.See The Nation and Athenaeum, 31 May, 7 June, 9 August 1924; Winch, Economics and Policy, pp. 108, 155–56.
82.‘Proposals for a Revenue Tariff’, New Statesman and Nation, 7 March 1931. The Economist pointed to the effects on the cost of living. ‘Inconsequences of Mr. Keynes’, 14 March 1931. ‘Crocodile tears’, Keynes jeered, citing its own call for reducing wages by 10–15 per cent. Keynes, CW, Vol. XX, pp. 499–500. Layton responded, along with Beveridge, Lionel Robbins and other LSE economists, in Tariffs: The Case Examined, ed. W. E. Beveridge, London 1931, pp. 76–92.
83.‘Out of the ashes the City of London will rise with undiminished honour … for she has played the game up to the limits of quixotry, even at the risk of driving British trade almost to a standstill. No banker could do more’: Keynes, ‘The Future of the World’, Sunday Express, 27 September 1931.
84.Nodding selectively at Keynes, it pointed to a disequilibrium between sav
ings and investment, which adjustments to monetary demand alone could correct: ‘Planning’, 13 January 1934; for Macmillan’s reply, 10 March 1934. See E. H. Green, Ideologies of Conservatism: Conservative Political Ideas in the Twentieth Century, Oxford 2002, pp. 158–62.
85.Hubback, No Ordinary, pp. 95–96. Douglas Jay’s contention that the Economist vigorously supported reflation and began to use the term ‘full employment’ without reservation, ‘helping in no small way to make the idea respectable’, is exaggerated: D. W. Parsons, Power of the Financial Press, New Brunswick 1990, p. 69.
86.‘Mr. Keynes on Money’, 29 February 1936.
87.This is the sense of Keynes’s famous remark in ‘Am I a Liberal?’, a 1925 talk at a Layton-organized Liberal Summer School: ‘The difficulty is that the Capitalist leaders in the City and in parliament are incapable of distinguishing novel measures for safeguarding Capitalism from what they call Bolshevism’: Keynes, Essays in Persuasion, New York 1932, p. 327. For Keynes’s ambiguous and shifting use of the term ‘rentier’, which must qualify the radical conclusion of the General Theory calling for the ‘euthanasia of the rentier’, see Ross McKibbin, English Historical Review, February 2013, p. 99.
88.‘Memoirs’, Layton Papers, TCC, Box 147, p. 250.
89.From 8 per cent in 1913 to 2.5 per cent in 1925; by 1930, £500 million or 12 per cent of overseas investment was in India. Atkin, British Overseas Investment, pp. 13–16. For the failure of the ‘imperial option’, based on the decline of income on invisibles from £365 million in 1929 to £230 million in 1938, see Skidelsky in Balance of Power, p. 184.
90.Katherine Mayo, Mother India, New York 1927; Layton, Dorothy, p. 104. Layton’s assistant was Benegal Rama Rau, later ambassador to Washington and governor of the Bank of India. See Hubback, No Ordinary, pp. 103–11; Ganesh Bhaskar Jathar and Shridhar Govind Beri, Indian Economics, a Comprehensive and Critical Survey of the Economic Problems of India, Vol. II, Oxford 1931, pp. 489, 531.
91.‘Indian Finance’, 5 July 1930; ‘Federalism in the British Empire’, 9 August 1930.
92.Indians gained provincial self-government and the majority of seats in parliament, but London kept tight control of finance, defence and foreign affairs, with Dominion status deferred. The Economist criticized Gandhi’s so-called non-cooperation movement as violent and for refusing to concede representation for minority Muslim, Sikh and lower caste Indians. See ‘India’, 24 May 1930; ‘Indian Developments’, 7 June 1930; ‘Round Table Conference’, 9 July 1930; ‘Outlook in India’, 13 September 1930; ‘The Crux for the Conference’, 27 December 1930; ‘Indian Truce’, 14 March 1931; ‘British Policy and India’, 28 November 1931; ‘The Lothian Report’, 11 June 1932. ‘Constitution-making on a stupendous scale’ called forth a nineteen-page supplement on the history of the Raj from Layton on 2 February 1935.
93.Tom Segev, One Palestine, Complete: Jews and Arabs under the British Mandate, New York 2000, p. 415.
94.Was Palestine another Ireland, the Arabs Sinn Fein? ‘Are we going to crush them in the ruthless fashion in which Mussolini has crushed the Amharas? Or are we going to betray our Zionist protégés?’: ‘Palestine in Ferment’, 30 May 1936; ‘Uproar in Palestine’, 13 June 1936; ‘Turning the Screw in Palestine’, 20 June 1936. Britain should retain a mandate over the Holy Places, acting as a buffer between the two communities, and impose a free trade treaty on both states: ‘Partition of Palestine’, 10 July 1937; ‘Geneva and Palestine’, 7 August 1937; ‘Mandate Commission’, 28 August 1937; ‘The Arab World’, 11 June 1938; ‘No Change in Palestine’, 20 May 1939.
95.Clarke, Hope and Glory, p. 116.
96.‘Memoirs’, Layton Papers, TCC, Box 147, p 206; 8 September 1955, Box 82.116.
97.Lloyd George acquired a majority of shares in the Daily Chronicle through his political fund in 1918, selling them on in 1926 to Sir David Yule, Sir Thomas Catto and the ex-viceroy Lord Reading; it was resold to Henry Harrison, the paper magnate, soon after. Lord Cowdry bought the Westminster Gazette in 1921. Taylor, English History, p. 118; ‘Yule Family’, Iain F. Russell in ODNB, 2004; Kathleen Burk, Morgan Grenfell, 1838–1988: The Biography of a Merchant Bank, London 1989, p. 82.
98.Charles Lysaght, Brendan Bracken, London 1979, pp. 82, 62. Evelyn Waugh on the Bracken-inspired Rex Mottram: ‘His seniors thought him a pushful cad’, but Lady Julia, ‘recognized the unmistakable chic – the flavour of “Max” and “F.E.” and the Prince of Wales, of the big table in the Sporting Club, the second magnum and the fourth cigar, of the chauffeur kept waiting hour after hour without compunction’. ‘He wasn’t a complete human being at all. He was a tiny bit of one unnaturally developed; something in a bottle, an organ kept alive in a laboratory. I thought he was a sort of primitive savage, but he was something absolutely modern and up-to-date that only this ghastly age could produce’: Brideshead Revisited, London 1945, pp. 162, 177.
99.Lysaght, Brendan Bracken, p. 99.
100.Strakosch started as a foreign exchange dealer for the Anglo-Austrian Bank in London, where he moved in 1891 from his birthplace in Hohenau, Austria, before rising to oversee the Union Corporation. Along the way, he became a confidant of Montagu Norman and the Rothschilds, and an expert on the global monetary system – travelling to nearly as many conferences as Layton to try to repair it in the interwar period, for the League and as advisor to South Africa and India: H. Strakosch, The Value of Gold in Our Economic System, London 1918; Boyce, British Capitalism, pp. 42, 167; Russell Ally, Gold and Empire: The Bank of England and South Africa’s Gold Producers, 1886–1926, Johannesburg 1994; C. E. Temperley, ‘Strakosch, Sir Henry Edouard (1871–1943)’, Maryna Fraser in ODNB, 2004. Strakosch criticized Keynes for ‘The Economic Consequences of Mr. Churchill’ in the Times of 31 July 1925. For his views in favour of stabilizing the price level by keeping gold but managing its distribution through the League and the Bank for International Settlements, see the Economist 10 November 1928 and 5 July 1930.
101.Hubback, No Ordinary, p. 87.
102.The largest individual shareholders were: Lord Cowdray of Pearson, an international construction firm converting itself into a financial and publishing business, which controlled Lazard Brothers, 7,500 shares; W. W. Greg, who was Julia Wilson and W. R. Greg’s son, 7,000; at 5,000 each, Laurence Cadbury, Lionel Nathan de Rothschild and Anthony Gustav de Rothschild, Walter Runciman and Baron Bruno Schroder; at 3,000, Henry Strakosch and Joseph Kitchin, both of Union Corporation; at 2,000 R. H. Brand of Lazard Brothers; 1,500 for Ernest Simon and Henry Graham White; 1,250 to Layton; 500 to Sir Laurence Halsey; 250 to D. E. W. Gibb. See Edwards, Pursuit of Reason, p. 620.
103.Stanley Morrison and Beatrice Warde of the Monotype Corporation, along with the chief compositor of Eyre and Spottiswoode. Warde had remarked to Hutton, who pushed the change: ‘The Times is pulling up its socks. Hadn’t you better pull yours up?’: Edwards, Pursuit of Reason, pp. 717–18, 736; Hubback, No Ordinary, pp. 85–86. Layton then targeted a circulation of 20,000. Layton to Strakosch, May–July 1938, Layton Papers, TCC, Box 81.62.
104.Jay claimed to have been converted to Labour in 1926 during the General Strike, while still at Winchester. Douglas Jay, Change and Fortune: A Political Record, London 1980, p. 22. Jay left the Economist in 1937, the year The Socialist Case appeared. Tom Dalyell, ‘Lord Jay’, The Independent, 6 March 1996.
105.Hutton was the brother-in-law of Evan Durbin, another young Labour economist trained at New College, Oxford, under Lionel Robbins. Durbin moved with Robbins to the LSE, becoming a personal assistant to Clement Attlee in 1942. See Isaiah Berlin: Letters, 1928–1946, London 2012, Vol. I, p. 433; Elizabeth Durbin, New Jerusalems: The Labour Party and the Economics of Democratic Socialism, London 1985, pp. 112, 253–54.
106.Martin Gilbert, Winston Churchill, London 1966, Vol. V, pp. 541, 605, 616; Hugh Purcell, A Very Private Celebrity: The Nine Lives of John Freeman, London 2015. Ian Mackay, interviewing for the industrial correspondent job at the News Chronicle in 1934, is supposed to have told
Vallance he would take it if there were no objections to his politics: ‘What are they?’ ‘I regard Stalin and Trotsky as a couple of crusted old Tories.’ ‘You’ll do’, replied Vallance. George Glenton and William Pattinson, The Last Chronicles of Bouverie Street, London 1963, p. 52.
107.Jay, Change and Fortune, p. 52; Nicholas Davenport, Memoirs of a City Radical, London 1974, p. 111. Layton may have met Toynbee through Gilbert Murray, his Greek tutor at Oxford. Toynbee’s surveys for the Royal Institute appeared from 1925 to 1938. William H. McNeil, Arnold J. Toynbee: A Life, New York 1989, p. 132.
108.Balogh arrived after stints as a researcher at the French, German and US central banks, with Keynes interested in his then orthodox views on gold flows between these banks and the Bank of England. Keynes and the Second World War changed Balogh: ‘the palpable impotence of the respectable … when confronted with the collapse of the social framework and political stability of Central Europe, cured me of my childhood bogey of inflation’: Paul Streeten, ‘Thomas Balogh’, in A Biographical Dictionary of Dissenting Economists, eds. Philip Arestis and Malcolm C. Sawyer, Cheltenham 1992, pp. 28–35. Parsons, Power of the Financial Press, p. 69; ‘I mistrust everything he says’, a wary Leonard Woolf told Kingsley Martin: see Leonard Woolf, Letters, ed. Frederic Spotts, London 1989, pp. 437–39, 452. Nicholas Kaldor ‘converted’ to Keynesianism while on a fellowship to the US in 1934–35, away from the LSE: Angus Burgin, The Great Persuasion: Reinventing Free Markets since the Depression, Cambridge, Mass, 2012, p. 29.
109.Hodson seems to have been recruited to the Economist through Lionel Robbins, his economics tutor at Oxford, in 1928 – to find ‘the statistics he needed to complete his thesis on overseas investment’: Hubback, No Ordinary, p. 88. Hodson left to edit the Round Table in 1934, spent part of the war in India working on constitutional reform for Leo Amery, and from 1950–61 was the Sunday Times editor. For other staff writers, see Edwards, Pursuit of Reason, pp. 687–88, 732–33.
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